Diversification as a Means of Achieving Sustainable Development Goal on Poverty Eradication: Evidence from Farm Households, Rural Nigeria

Abstract

High incidence of poverty in sub Saharan Africa and other parts of developing countries has clearly shown that that a lot have to be done towards the accomplishment of sustainable development goal (SDG) of poverty eradication by the year 2030. The objective of this study is to examine the effect of diversification on poverty reduction among farm households in rural Nigeria with a view to proffer possible suggestions on how to achieve sustainable development goal on poverty eradication by 2030. The study used per capita consumption expenditure as a measure of economic wellbeing as well as poverty status. Data on the third wave of the Nigerian General Household Survey (GHS) with a nationally representative sample of 3,256 panel rural households conducted by the Nigerian Bureau of Statistics in collaboration with the World Bank in 2015/2016 was used for the study which was analysed using propensity score matching approach. The matching results revealed that diversification has a positive and significant effect on the household wellbeing irrespective of their poverty status. However, diversification contributes more to the wellbeing of the non-poor households than the poor ones. In the light of the foregoing, the study recommends that sustainable development policies seeking to address rural poverty should not only consider agricultural development. They should also consider enhancing the ability of poor rural households to diversify into high return non-farm activities as it supplements their earnings from agriculture and have positive significant effect on their wellbeing. Further, there is need to encourage rural banking scheme with the simple collateral requirement as well as promote cooperative societies, educational programmes, non-farm enterprise activities and community infrastructures.