Income pattern and consumption behavior of farm households in Punjab

Abstract

An enquiry into the income pattern and consumption behavior of agricultural households of Punjab was conducted. The data was collected from three agro-climatic zones of Punjab in which 50 farmers were selected randomly from each zone making total sample of 150 farmers. The results revealed that income, consumption and savings increase with increase in farm size. The sources of farm household income were crops (78.08%), livestock (13.00%) and non-farm sources (8.92%). The share of farm income in the total income in zone I, II and III was 70.08, 76.33 and 87.47 per cent, respectively. Average consumption expenditure per household was Rs. 166124, with major share of food items (52.61%). The annual availability of post consumption funds was least (34.19%) on marginal farms and highest (87.88%) on large farms. These funds were highest (Rs. 547533/household) in zone II and least (Rs. 390351/household) in zone III. Consumption to income ratio (C:I ratio) for farm households was 1:4 while for marginal and large farm households was 1:1.5 and 1:8, respectively, which highlights vulnerability of marginal farmers. The study also highlights the prevalence of high income inequality among farm households in Punjab agriculture. The Gini coefficient came out to be 0.49. It is suggested that the government should ensure policies which support marginal and small farmers in livestock sector. It was also suggested to promote skill development centers which can help family members of farm households to work in non-farm sector.