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Does Remittance Offset the Effect of Loss of Labour Through Migration on Agricultural Productivity in Tanzania?

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  • Eghan, Mark

Abstract

This paper assessed the effects of migration and remittances on the agricultural productivity of households in Tanzania. Using the most recent nationally representative crosssectional household survey dataset, the three-stage least squares (3SLS) estimate the model to correct for the endogeneity of the remittance variable. The results showed that remittances did not positively impact agricultural productivity in Tanzania. This finding implies that the shortage of agricultural labour due to migration is further worsened by using remittances for household consumption instead of investing in productive agricultural assets. Using the NELM theory as an analytical framework, the findings do not support the argument that remittances could relax credit constraints faced by agricultural households as stipulated by the NELM theory.

Suggested Citation

  • Eghan, Mark, 2022. "Does Remittance Offset the Effect of Loss of Labour Through Migration on Agricultural Productivity in Tanzania?," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 10(4), October.
    • Handle: RePEc:ags:ijfaec:329627
    DOI: 10.22004/ag.econ.329627
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    1. 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.
    2. Julien, Jacques C. & Bravo-Ureta, Boris E. & Rada, Nicholas E., 2019. "Assessing farm performance by size in Malawi, Tanzania, and Uganda," Food Policy, Elsevier, vol. 84(C), pages 153-164.
    3. Stark, Oded & Bloom, David E, 1985. "The New Economics of Labor Migration," American Economic Review, American Economic Association, vol. 75(2), pages 173-178, May.
    4. Ayala Wineman & Thomas S. Jayne & Emma Isinika Modamba & Holger Kray, 2020. "The changing face of agriculture in Tanzania: Indicators of transformation," Development Policy Review, Overseas Development Institute, vol. 38(6), pages 685-709, November.
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