Rural-urban migration and capital transfer: Possible effects on food prices in Nigeria

Abstract

The problem of population movement and its relation to the food production/consumption pattern has been a source of concern to policymakers in Nigeria. Early decisions in this area have been taken on the basis of limited empirical evidence on the relationship between migration, capital transfer from rural areas and food prices. In this study, an attempt is made to determine the effect of rural-urban migration on investment in agriculture and resultant capital transfer due to such out-migration behaviour from the countryside to the towns. The potential impact on food prices is assessed. The findings indicate that rural areas in Nigeria experience massive net capital outflow due to such rural-urban migration. The major component of this capital movement is in the form of investment in the education (formal training) of migrants. Back capital transfers are minimal and the effect on food prices is enormous—more so for the rural than the urban areas.