Impact assessment of non-farm enterprises on poverty status of rural farming households in Nigeria

Abstract

This study evaluates the impact of non-farm enterprises on the poverty status of rural farming households in Nigeria. The data were obtained from General Household Survey fielded by the National Bureau of Statistics in 2010/2011 and 2015/2016. However, only 1,619 matched observations were used for analyses, using Propensity Score Matching, Double Difference, Foster-Greer-Thorbecke poverty measures and Poverty Equivalent Growth Rates (PEGRs). The results show that 53.3% of participants lived below the poverty line (poor) in 2011, while in 2016, this proportion declined to 31.94%. The poverty incidence of female participants (0.5504) decreased by 53.68% while that of male participants (0.4112) decreased by 4.81%. If female participants had not participated in non-farm enterprises, their poverty would have been reduced by only 9.7% but due to participation, it was reduced by 53.68%. The Poverty Equivalent Growth Rates are higher for all the three FGT measures than the actual growth rates for all participants, males and females with females showing higher poverty reduction; which means that growth was propoor, although the poverty of the poor decreased more than that of the core poor. Also, after five years there is a decline in poverty incidences of participants across the six geopolitical zones and the decline was mostly felt in the North East (NE) followed by North Central (NC) while the least percentage decline was seen in North West (NW). Since participation in non-farm activities had a significant impact on the poverty of participants, the promotion of non-farm enterprises among poor farmers should be encouraged.