SECTION 1

1.0 INTRODUCTION

1.1 BACKGROUND TO THE STUDY

Household food consumption expenditure is a critical issue in most developing countries

(Obayelu, 2009). The level of household income is often a determinant of expenditure and

largely a reflection of differences in living standard. The proportion of household expenditure

on food is usually very significant and can be used in assessing general household's

consumption in many developing economies. There is also a higher propensity of households

with higher income to spend a bigger proportion of the food budget on a diversified diet thus

improving the nutritional status of the household members. This is especially meaningful in

developing countries where food expenditure accounts for a relatively large share of

household income.

Anyanwu (1995) defined consumption as the spending by households on goods and services

such as clothing, food items, entertainment, health services and acquisition of assets among

others. Arising from this definition is the concept of consumption function which shows the

relationship between consumption and disposable income. The term “consumption”

originates from Lord Keynes psychological law which says that men are disposed as a rule on

the average to increase their consumption as income increases but not by as much as the

increase in income. This law is known as the Absolute Income Hypothesis (AIH). However,

further investigation into the determinants of consumption expenditures have revealed that

consumption expenditure is determined by many other factors aside from income. At the

macro levels, Colander (2001), Jhingan (2002), Koutsouyiannis (2001) and Iyoha (2001)

identified interest rate, relative prices, capital gains, wealth, liquid assets, attitude and

expectation and availability of consumer credit among others as determinants of consumption

expenditure. Consumption is a major component of aggregate demand. In Nigeria today, a

sizeable percentage of the nations' population are either farming households or non-farming

households. A country cannot be adjudged developed without significant improvement in the

standard of living of the nations' population. Given the importance of a nations' population to

its development and the significance of consumption as a major component of aggregate

demand, there is need to examine the consumption profiles in different subsectors of the

economy.

1.2 STATEMENT OF PROBLEM

There is paucity of studies that directly investigate food consumption of farm and non-farm

households’ income. Past work on food expenditure has focused more on farm households

based on the thinking, low level of education, and decline in level of productivity as more an

issue affecting the rural poor communities but recent studies shows that there is need for

more of such study for non-farm households. Thus the essence of this study “Food

Consumption Pattern of Farm and Non-Farm Households in Abia State, Nigeria” is to

determine the difference in income levels of the Farm and Non-Farm Households so as to

know the share of their respective income allocated to food expenditure.

1.3 RESEARCH QUESTIONS

This research seeks to address the following questions:

i. What are the socio-economic characteristics of farm and non-farm households?

ii. What are the economic activities of the farm and non-farm households?

iii. What is the income pattern of the farm and non-farm households?

iv. What is the percentage share of income allocated to food expenditure by the farm and

non-farm households?
 v. What are the determinants of the food expenditure of the farm and non-farm

households?

1.4 OBJECTIVES OF THE STUDY

The broad objective of this study will explore the Food Consumption Pattern of Farm and

Non-Farm Households in Abia State, Nigeria.

The specific objectives are to:

i. determine the socio-economic characteristics of farm and non-farm households?

ii. identify the economic activities of the farm and non-farm households?

iii. determine the income pattern of the farm and non-farm households?

iv. determine the percentage share of income allocated to food expenditure by the farm

and non-farm households?

v. analyze the determinants of food expenditure of the farm and non-farm households?

1.5 RESEARCH HYPOTHESES

In this study, the following hypotheses will be tested:

Ho1: Food consumption expenditure of the farm and non-farm households is not significantly

affected by marital status, household size, farm size and educational level.

Ho2: Food consumption expenditure of the farm and non-farm households is not significantly

affected by their income pattern.

1.6 SIGNIFICANCE OF THE STUDY

This study “Food Consumption Pattern of Farm and Non-Farm Households in Abia State,

Nigeria” will be of immense benefit to individuals and households so as to properly allocate

scarce resources to food items necessary for the general wellbeing of the individual or the

household.

This study will be of immense benefit to policy makers in their decision making so as to

formulate sound policies that are beneficial to the households on the long run.

This research work will serve as a basis for further research in the area of household food

consumption expenditure.

1.7 SCOPE OF THE STUDY

In view of the need for an effective research work, this study will be narrowed down to Food

Consumption Pattern of Farm and Non-Farm Households in Ikwuano Local Government

Area of Abia State, Nigeria.

 SECTION 2

2.0 LITERATURE REVIEW

2.1 Concept of Farming Households

2.2 Concept of Non-Farming Households

2.3 Concept of Consumption

2.4 Concept of Consumption Pattern

2.5 Concept of Consumption Function

2.6 Concept of Consumption Expenditure

2.7 Theoretical Framework

2.8 Empirical Review

 SECTION 3

3.0 METHODOLOGY

3.1 STUDY AREA

The study will be carried out in Abia State. Abia State was carved out of the former Imo state

in 27th August, 1991 with its capital at Umuahia. The name “Abia” was coined from the first

letters of the name of the geographical (political group that made up the state namely; Aba,

Bende, Isiukwuato and Afikpo though Afikpo joined Ebonyi state in 1996. The state consists

of seventeen (17) local Government Areas and three (3) agricultural zone namely: Aba,

Bende and Umuahia.

The state is located in the southeastern region of Nigeria and lies within approximately

latitude of 4o40 and 6o14 North and longitude 7o10 and 8o East (National Bureau of statistic,

2005) and its population are about 2,845,380 million (NPC, 2006). The state is bounded by

the North and Northeast by the states of Anambra, Enugu and Ebonyi. To the west it is Imo

state, to the West and south east are Cross River state and Akwa-Ibom state and to the South

is River State. It covers an area of about 5,24375sq km.

The state is low lying with a heavy rainfall of about 2,400mm which is evenly distributed

between months of April through October. The rest of the state is moderately high plain. The

State is located within the forest belt of Nigeria and the temperature ranges between 20c and

36oC. It is characterized by the Dry west laid north-eastern wind which slows across the

country during the dry season (mid October to March). The people are predominantly Igbos

and agrarian. The main food crops grown are yam, cassava, rice, cocoyam, and maize and

cash crop such as oil palm, cocoa, rubber and livestock include goat, sheep, poultry etc.
3.2 SAMPLING PROCEDURE

Purposive sampling technique will be used for this study. Ikwuano Local Government Area

of Abia state will be purposively selected because of the familiarity of the Local Government

Area with the researcher. Fifty (50) farm and non-farm households each will be selected

which will make up a total of hundred (100) sample size for the field work.

3.3 DATA COLLECTION

Primary data will be used for the study and it will be collected via the administration of well-

structured questionnaires.

3.4 METHOD OF DATA ANALYSIS

Objectives one, two, three and four will be realized using descriptive statistics such as

frequency counts, percentages and means while objective five will be achieved using multiple

regression analysis.

3.4.1 Model specification

Objective five will be achieved using multiple regression analysis and it is implicitly stated as

follows:

Y= f (X1, X2, X3, X4, X5, X6, X7, X8) μ … (3.1)

Where:

Y= food consumption expenditure of the farming household for a year (N)

X1= sex of household head (Male = 1, 0 = female)

X2= educational level of the household head (Years)

X3= net farm income (N)

X4= farming experience (Years)

X5= marital status (1 = married, 0 = single)

X6= farm size (Ha)

X7= household size (number)

X8= age of household head (years)

μ = error term

Y= f (X1, X2, X3, X4, X5, X6, X7) μ … (3.2)

Where:

Y= food consumption expenditure of the non-farming household for a year (N)

X1= sex of household head (Male = 1, 0 = female)

X2= educational level of the household head (Years)

X3= monthly income (N)

X4= experience (Years)

X5= marital status (1 = married, 0 = single)

X7= household size (number)

X8= age of household head (years)

μ= error term
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