IDEAS home Printed from https://ideas.repec.org/p/ags/aaea15/205517.html
   My bibliography  Save this paper

International Migration, Remittance Income, and Income Diversification Strategies among Rural Farm Households in Transitional Albania

Author

Listed:
  • Seidu, Ayuba
  • Onel, Gulcan

Abstract

The overarching consensus in the applied migration literature is that international migration is typically used to transition out of agricultural sector by rural households in transition economies. In this paper, using data on rural Albanian households, we examine whether international migration of some household members affects the household’s nonfarm activity choices and earnings generated from these activities. In addition, we test whether remittance income received from migrant household members have an indirect effect on households’ agricultural production. We find no apparent relationship between nonfarm activity choice and the number of international migrants in the farm household. However, we find that remittance income is positively and significantly related to households’ propensity to reallocate farm labor to nonfarm self-employment activities, resulting in higher income from non-farm self-employment. In addition, remittance income affects farm income in a positive and significant way. This suggests that previous studies likely underestimated the overall impact of international migration on agricultural production in rural Albania, as they usually ignored the additional remittance income effect. Overall, our empirical findings support the basic tenets of rural income diversification, where the farm household has a diversified portfolio of income-generating activities, in addition to farming. The results suggest that international migration facilitates income diversification among Albanian farm households rather than their exit out of agriculture.

Suggested Citation

  • Seidu, Ayuba & Onel, Gulcan, 2015. "International Migration, Remittance Income, and Income Diversification Strategies among Rural Farm Households in Transitional Albania," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205517, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea15:205517
    DOI: 10.22004/ag.econ.205517
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/205517/files/AAEA_May_27_Seidu_Onel_Final.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.205517?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Adams Jr., Richard H. & Cuecuecha, Alfredo, 2010. "Remittances, Household Expenditure and Investment in Guatemala," World Development, Elsevier, vol. 38(11), pages 1626-1641, November.
    2. Taylor, J Edward & Rozelle, Scott & de Brauw, Alan, 2003. "Migration and Incomes in Source Communities: A New Economics of Migration Perspective from China," Economic Development and Cultural Change, University of Chicago Press, vol. 52(1), pages 75-101, October.
    3. Stefan Dercon & Pramila Krishnan, 1996. "Income portfolios in rural Ethiopia and Tanzania: Choices and constraints," Journal of Development Studies, Taylor & Francis Journals, vol. 32(6), pages 850-875.
    4. Talip Kilic & Calogero Carletto & Juna Miluka & Sara Savastano, 2009. "Rural nonfarm income and its impact on agriculture: evidence from Albania," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 139-160, March.
    5. Stark, Oded, 1982. "Research on rural-to-urban migration in LDCs: The confusion frontier and why we should pause to rethink afresh," World Development, Elsevier, vol. 10(1), pages 63-70, January.
    6. Aslihan Arslan & J. Edward Taylor, 2011. "Transforming Rural Economies: Migration, Income Generation and Inequality in Rural Mexico," Journal of Development Studies, Taylor & Francis Journals, vol. 48(8), pages 1156-1176, November.
    7. Just, Richard E & Zilberman, David, 1983. "Stochastic Structure, Farm Size and Technology Adoption in Developing Agriculture," Oxford Economic Papers, Oxford University Press, vol. 35(2), pages 307-328, July.
    8. Reardon, Thomas, 1997. "Using evidence of household income diversification to inform study of the rural nonfarm labor market in Africa," World Development, Elsevier, vol. 25(5), pages 735-747, May.
    9. Winters, Paul & Davis, Benjamin & Carletto, Gero & Covarrubias, Katia & Quiñones, Esteban J. & Zezza, Alberto & Azzarri, Carlo & Stamoulis, Kostas, 2009. "Assets, Activities and Rural Income Generation: Evidence from a Multicountry Analysis," World Development, Elsevier, vol. 37(9), pages 1435-1452, September.
    10. Wouterse, Fleur & Taylor, J. Edward, 2008. "Migration and Income Diversification:: Evidence from Burkina Faso," World Development, Elsevier, vol. 36(4), pages 625-640, April.
    11. Frank Ellis, 2000. "The Determinants of Rural Livelihood Diversification in Developing Countries," Journal of Agricultural Economics, Wiley Blackwell, vol. 51(2), pages 289-302, May.
    12. Udry, Christopher, 1995. "Risk and Saving in Northern Nigeria," American Economic Review, American Economic Association, vol. 85(5), pages 1287-1300, December.
    13. Just, Richard E. & Pope, Rulon D., 1978. "Stochastic specification of production functions and economic implications," Journal of Econometrics, Elsevier, vol. 7(1), pages 67-86, February.
    14. Frank Ellis, 1998. "Household strategies and rural livelihood diversification," Journal of Development Studies, Taylor & Francis Journals, vol. 35(1), pages 1-38.
    15. Agnes Quisumbing & Scott McNiven, 2010. "Moving Forward, Looking Back: the Impact of Migration and Remittances on Assets, Consumption, and Credit Constraints in the Rural Philippines," Journal of Development Studies, Taylor & Francis Journals, vol. 46(1), pages 91-113.
    16. Lucas, Robert E B, 1987. "Emigration to South Africa's Mines," American Economic Review, American Economic Association, vol. 77(3), pages 313-330, June.
    17. J. Edward Taylor & Scott Rozelle & Alan deBrauw, 1999. "Migration, Remittances, and Agricultural Productivity in China," American Economic Review, American Economic Association, vol. 89(2), pages 287-291, May.
    18. Barrett, C. B. & Reardon, T. & Webb, P., 2001. "Nonfarm income diversification and household livelihood strategies in rural Africa: concepts, dynamics, and policy implications," Food Policy, Elsevier, vol. 26(4), pages 315-331, August.
    19. Guy Stecklov & Calogero Carletto & Carlo Azzarri & Benjamin Davis, 2010. "Gender and migration from Albania," Demography, Springer;Population Association of America (PAA), vol. 47(4), pages 935-961, November.
    20. Abdulai, Awudu & CroleRees, Anna, 2001. "Determinants of income diversification amongst rural households in Southern Mali," Food Policy, Elsevier, vol. 26(4), pages 437-452, August.
    21. Barry K. Goodwin & Matthew T. Holt, 2002. "Parametric and Semiparametric Modeling of the Off-Farm Labor Supply of Agrarian Households in Transition Bulgaria," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 184-209.
    22. Thomas Reardon & J. Edward Taylor & Kostas Stamoulis & Peter Lanjouw & Arsenio Balisacan, 2000. "Effects of Non‐Farm Employment on Rural Income Inequality in Developing Countries: An Investment Perspective," Journal of Agricultural Economics, Wiley Blackwell, vol. 51(2), pages 266-288, May.
    23. Amemiya, Takeshi, 1974. "Multivariate Regression and Simultaneous Equation Models when the Dependent Variables Are Truncated Normal," Econometrica, Econometric Society, vol. 42(6), pages 999-1012, November.
    24. Oded Stark, 1991. "The Migration of Labor," Blackwell Books, Wiley Blackwell, number 1557860300, June.
    25. Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Remittances as insurance: evidence from Mexican immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(2), pages 227-254, June.
    26. Junior Davis, 2005. "The rural non-farm economy, Livelihoods and their," Development and Comp Systems 0510016, University Library of Munich, Germany.
    27. Nancy McCarthy & Calogero Carletto & Talip Kilic & Benjamin Davis, 2009. "Assessing the Impact of Massive Out-Migration on Albanian Agriculture," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 21(3), pages 448-470, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Al-Amin, A.K.M. Abdullah & Hossain, M.J., 2019. "Impact of non-farm income on welfare in rural Bangladesh: Multilevel mixed-effects regression approach," World Development Perspectives, Elsevier, vol. 13(C), pages 95-102.
    2. M. J. Hossain & A. Debnath & M. F. Imam & M. A. Islam & F. Elahi, 2019. "Effects Of Non-Farm Income On Poverty And Inequality In Rural Bangladesh," Bangladesh Journal of Agricultural Economics, Bangladesh Agricultural University, vol. 39(1&2), December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Seidu, Ayuba & Onel, Gulcan & Moss, Charles B. & Seale, James L., 2016. "Do Off-farm Work and Remittances affect Food Consumption Patterns? Evidence from Albania," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235851, Agricultural and Applied Economics Association.
    2. Gamel Abdul-Nasser Salifu, 2019. "The Political Economy Dynamics of Rural Household Income Diversification: A Review of the International Literature," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(3), pages 273-290, December.
    3. Riithi, Alexander Njuguna & Irungu, Patrick & Munei , Kimpei, 2015. "Determinants Of Choice Of Alternative Livelihood Diversification Strategies In Solio Resettlement Scheme, Kenya," Dissertations and Theses 269714, University of Nairobi, Department of Agricultural Economics.
    4. Asfaw, Solomon & Scognamillo, Antonio & Caprera, Gloria Di & Sitko, Nicholas & Ignaciuk, Adriana, 2019. "Heterogeneous impact of livelihood diversification on household welfare: Cross-country evidence from Sub-Saharan Africa," World Development, Elsevier, vol. 117(C), pages 278-295.
    5. Wouterse, Fleur & Taylor, J. Edward, 2008. "Migration and Income Diversification:: Evidence from Burkina Faso," World Development, Elsevier, vol. 36(4), pages 625-640, April.
    6. Jan Fałkowski & Maciej Jakubowski & Paweł Strawiński, 2014. "Returns from income strategies in rural Poland," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 22(1), pages 139-178, January.
    7. Vellema, W. & Buritica Casanova, A. & Gonzalez, C. & D’Haese, M., 2015. "The effect of specialty coffee certification on household livelihood strategies and specialisation," Food Policy, Elsevier, vol. 57(C), pages 13-25.
    8. repec:dgr:rugcds:cds-27 is not listed on IDEAS
    9. Md.Salamun Rashidin & Sara Javed & Bin Liu & Wang Jian, 2020. "Ramifications of Households’ Nonfarm Income on Agricultural Productivity: Evidence From a Rural Area of Pakistan," SAGE Open, , vol. 10(1), pages 21582440209, January.
    10. Van Nam, M. & Lensink, R., 2008. "Economic Development of the Mekong Delta in Vietnam," CDS Research Reports CDS-27, University of Groningen, Centre for Development Studies (CDS).
    11. Lay, Jann & Schüler, Dana, 2008. "Income Diversification and Poverty in a Growing Agricultural Economy: The Case of Ghana," Proceedings of the German Development Economics Conference, Zurich 2008 39, Verein für Socialpolitik, Research Committee Development Economics.
    12. Bezu, Sosina & Barrett, Christopher B. & Holden, Stein T., 2012. "Does the Nonfarm Economy Offer Pathways for Upward Mobility? Evidence from a Panel Data Study in Ethiopia," World Development, Elsevier, vol. 40(8), pages 1634-1646.
    13. Dil Bahadur Rahut & Akhter Ali & Menale Kassie & Paswel P. Marenya & Chudamani Basnet, 2014. "Rural Livelihood Diversification Strategies in Nepal," Poverty & Public Policy, John Wiley & Sons, vol. 6(3), pages 259-281, September.
    14. Lay, Jann & M'Mukaria, George Michuki & Omar Mahmoud, Toman, 2007. "Boda-bodas rule: Non-agricultural activities and their inequality implications in Western Kenya," Proceedings of the German Development Economics Conference, Göttingen 2007 20, Verein für Socialpolitik, Research Committee Development Economics.
    15. Drall, Anviksha & Mandal, Sabuj Kumar, 2021. "Investigating the existence of entry barriers in rural non-farm sector (RNFS) employment in India: A theoretical modelling and an empirical analysis," World Development, Elsevier, vol. 141(C).
    16. Mark Musumba & Cheryl A. Palm & Adam M. Komarek & Patrick K. Mutuo & Bocary Kaya, 2022. "Household livelihood diversification in rural Africa," Agricultural Economics, International Association of Agricultural Economists, vol. 53(2), pages 246-256, March.
    17. Ubaid Ali & Mazhar Mughal & Lionel de Boisdeffre, 2023. "Migrant remittances, agriculture investment and cropping patterns," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(3), pages 899-920, September.
    18. Pace, Noemi & Sebastian, Ashwini & Daidone, Silvio & Dela O Campos, Ana Paula & Prifti, Ervin & Davis, Benjamin, 2022. "Cash transfers’ role in improving livelihood diversification strategies and well-being: short- and medium-term evidence from Zimbabwe," World Development, Elsevier, vol. 154(C).
    19. Solomon Zena Walelign & Mariève Pouliot & Helle Overgaard Larsen & Carsten Smith-Hall, 2015. "A novel approach to dynamic livelihood clustering: Empirical evidence from Nepal," IFRO Working Paper 2015/09, University of Copenhagen, Department of Food and Resource Economics.
    20. Khan, Rumman & Morrissey, Oliver, 2023. "Income diversification and household welfare in Uganda 1992–2012," Food Policy, Elsevier, vol. 116(C).
    21. Koirala, Krishna H. & Mishra, Ashok K. & Mehlhorn, Joey, 2014. "Using Copula to Test Dependency between Energy and Agricultural Commodities," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170364, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    Consumer/Household Economics; International Development; Labor and Human Capital;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea15:205517. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.