CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Nigeria is considered the most populous country in Africa and the 8th
in the world with a population of over 140 million people by 2006
census. With a nominal GDP of $207.11 billion and per capita income of
$1,401 it has the second largest economy in Africa (Salami, 2011). Rural
poverty results from lack of assets, limited economy opportunity and
poor education and capabilities, as well as disadvantages rooted in
social and political inequalities. Most countries of the world fall
under the absolute poverty line. This indicates that they live on less
than one U.S Dollar per day. Those that are moderate or relatively poor
live on more than one US Dollar but less than two Dollars per day
(Buhman et al, 1988). Over one billion people are living in
extreme poverty today, who have less than US $ 1 per day to survive on
(Addison, 2004). The extent and depth of poverty in the developing world
is a disgrace (Pinstrup-Andersen &Pandya-Lorch, 2001). Poverty is a
multi-dimensional, socioeconomic and cultural situation that transcends
economic description and analysis (Okunmadewa, 2001; Mafimisebi, 2002).
Poverty can be absolute or relative. Absolute poverty refers to
subsistence poverty, based on assessment of minimum subsistence
requirements, involving a judgment on basic human needs and measured in
terms of resources required to maintain health and physical efficiency
(Foster et al, 2010). The poverty line from this approach has a
fixed value of US$1.25/day (Sola, 2007). Relative poverty is defined by
reference to the living standards of majority in a given society that
separates the poor from the non-poor. Households with expenditure
greater than two-thirds of the total household per capita expenditure
are non-poor whereas those below it are poor. Relative poverty varies
with income or economic growth. The poverty line from this approach is
commonly expressed as a fixed percentage of the mean or median income or
expenditure.
A conclusive definition recognize
poverty as a way of life characterized by low calorie intake,
inaccessibility to adequate health facilities, low quality education
system, low income, unemployment and under employment as well as
inaccessibility to various housing and social facilities (Onibokun and
Kumuyi, 1996).Poverty is strongly influenced by education and location
but in Nigeria, poverty is seen as a rural problem where majority of the
inhabitants engage in agricultural production as a means of livelihood
(Olorunsanya, 2009; Olorunsanya and Omotesho, 2012). In fact rural
poverty is widely regarded as the main constituent of poverty (Patel,
2004; Olorunsanya and Omotesho, 2012). Although the relative importance
of rural poverty varies substantially from one country to another, in
developing countries as a whole, more than 70 percent of total poverty
is found in rural areas; consequently, the evidence is clear that
broad-based agricultural development provides an effective means of both
reducing poverty and accelerating economic growth (FAO, 2001;
Olorunsanya, 2009).
Poverty contributes to poor agricultural
productivity, as many farmers in Nigeria cannot afford to purchase
necessary input such as fertilizers, pesticides and improved seeds which
could bring about increased productivity. Also, the ability of poor
consumers to purchase food necessary for maintenance of health and
productive life is reduced. The fact that security in Africa has greatly
worsened since 1970(Rosegrantet al., 2005) has resulted in
decline in per capita consumption of food in some African regions in
recent times. Agricultural research, a vital component of integrated
strategies for poverty reduction, has a crucial role to play in creating
escape from food insecurity and poverty by improving farm income,
generating employment for farm workers, reducing food prices and fueling
economic growth. Boosting agricultural growth by applying new
technologies is one important way to reduce rural poverty.
According to the Federal Office of
Statistics, incidence of Poverty in Nigeria increased sharply between
1980 and 1985 and between 1992 and 1996. Critical factors responsible
for this are rapid population growth or over population, the use of poor
inappropriate technology, low growth rate of economy, prevalence of
inappropriate source allocation, particularly in the public sector and
low rate of investment. The interaction of this variable places a large
sector of the economy in vicious cycle of poverty. The rural areas and
vulnerable groups, especially women, were affected more by the worsening
poverty situation Nigeria experienced in the 1980s and 1990s.Incidence
of poverty rose from 46.3% of the population in 1985 to 65.5% in 1996.
Available data indicate that majority of
the poor are located in the rural areas. In 1985, 1992 and 1996 the
share of the poor in the rural areas were 49.9%, 46.1% and
67.8%respectively, making poverty largely a rural phenomenon using
consumption and income analyses.The situation in the SSA is that rural
poverty account for 65.9% of the overall poverty (Aigbokhan, 2000). Of
serious concern is the statistic that about 77% of farmers are poor, out
of which more than 48% is extremely poor.
Poverty in Nigeria is multi-dimensional
in occurrence; it is not region specific, spreading its tentacles across
the whole nation. Its reflection was quite noticeable in the lives of
rural household as well as urban household. Though a greater population
of the Nigeria population resides in the urban areas, poverty has been
on an alarming rate of increase in the rural areas. Poverty, in general
term means a state of living in which an individual or community suffers
from deprivation, these being majority in terms of financial resources.
Deprivation is also in terms of access to good nutritional food,
portable water, comfortable accommodation and a hygienic environment. It
is also characterized by hunger, unemployment, inadequate transport
facilities among others.
Rural poverty appears to be endemic in
sub-Saharan Africa (SSA), and this situation has attracted much
attention. Particularly disheartening is the fact that this problem,
rather than abate, is proving intractable, at least in certain regions.
One of the serious effects of rural poverty, of course, is food and
nutrition insecurity, and its attendant socio-economic and political
cost. A food secured household is one that reliable obtain food of
adequate quality and quantity to support a healthy and active life for
all members of the household (Heidhueset. al, 2004). This study
will be use to analyze the poverty profile among the rural households
in Ido Local Government area in Oyo State.
Poverty is a global phenomenon which
threatens the survival of mankind. It cuts across creed, race, and
space. Poverty is a multifaceted event in nature with physical,
economic, social and psychological dimensions (Narayan and Chambers,
2000). This informed the United Nations declaration of 1996 as the
“International Year for the Eradication of Poverty” and October17 of
every year designated as the “International Day for the Eradication of
Poverty” worldwide. Similarly, the decade 1997 – 2006 has been declared
United Nations Decade of Eradication of Poverty (Usman, 2001). Poverty
is now acknowledged as the main goal of international development, for
instance the millennium declaration of the United nations signed by
189countries commits the global community to reduce by half the
proportion of the world’s poor and hungry by 2015 (IFPRI, 2001).
Most previous analysis follows the
conventional view of poverty as insufficiency in securing basic goods
and services (Olayemi, 1995; Ravallion, 2004). Others view poverty, in
part, as a function of education, health, life expectancy, child
mortality, housing, sanitation, potable water supply and adequate
nutrition(Obadan, 1997; Englena and Bamidele, 1997).By and large, the
poor have been described as those who cannot satisfy their basic needs
of food, clothing and shelter, unable to meet social and economic
obligations, lack gainful employment, are deprived of access to basic
facilities and human well-being and unable to attain minimum standard of
living (Aigbokhan,2000; World Bank, 2001).
The poor in most developing countries
are found among five identifiable economic groups the urban
underdeveloped, the rural landless, the resource poor farmers, the urban
underemployed and the unemployed (World Bank, 1997). Generally, the
poor are disproportionately located in the rural areas and the urban
slums. Poverty has the consequences of breeding social disillusion with
respect to what the societal objectives are and members’
responsibilities towards attainment of these objectives. A society where
the majorities spend 90% of their income on consumption with little or
nothing for saving and eventual plough back into the economy would be
impeded by slow growth. This means that the affected group would not be
able to participate effectively in national development. Poverty in this
sense would result in a vicious cycle reproducing itself in perpetuity.
In the light of this, this study will presents the analysis of poverty
profile among of rural households in Ido Local Government area in Oyo
State.
1.2 Problem Statement
The problem of poverty has been a long
standing issue in Nigeria. This is indicated by the low social status
and poor living conditions of the inhabitants. The problem has been made
worse over the years by the development pattern which has favored the
urban modern sectors to the detriment of the traditional rural sectors
(World Bank, 1997).
A recent poverty assessment survey has
shown that over 70% of the populations are living on less than a dollar
per day and over 50% are living below the national poverty line. The
survey also revealed that poverty is especially higher in rural areas
where majority of the population are resident and derive their
livelihoods from agriculture (FAO, 2006). The World Bank poverty
assessment on Nigeria has shown that the nature of those in poverty can
be distinguished by some characteristics such as education, age, gender,
employment status of the head of household, household size and the
share of food in total expenditure. Table1 presents the percentage of
persons and households below the poverty line in 1996/97 by some of
these characteristics. The table shows that 67.1 million Nigerians were
in poverty in 1996/97, out of which 23.3 million and 43.8 million were
located in urban and rural areas, respectively [Federal Office of
Statistics FOS (1999)]. Thus about 65% of the poor live in the rural
areas, indicating that poverty in Nigeria is largely a rural phenomenon.
For example, in 1992, 46.4 million Nigerians were said to be living in
absolute poverty, out of which 80.2% or 37.7 million are in the rural
areas (Ogwumike, 1996).
Nigeria is rated as the eighth largest
oil producing country in the world, yet it harbors the largest
population of poor people in sub-Saharan Africa and is ranked 158th on
the human development index. There is also pervasive high-income
inequality, which has perpetuated the concentration of wealth in the
hands of a few individuals (Action Aid Nigeria, 2009). The per capita
income of $290 in Nigeria when compared to the world’s per capita income
of $7,140 as at 2003 further shows the state of poverty among
households (Garba, 2006).
Oladunni (1999) further pointed out that
incidence of poverty in Nigeria has been increasing. This is as a
result of overall dependency ratio in Nigeria which is put at 234
dependents per 100 gainfully employed people. In the rural areas, it is
286 dependents per 100 workers and 219 dependents per 100 workers in the
urban areas. The above scenario further reinforced the poverty syndrome
of the average Nigerian employee whether involved in farming or
non-farming activities. In 2004 the urban population with access to
water was 67 percent, while it was 31 percent in the rural areas. In
terms of sanitation services, 53 percent of the urban population had
access to sanitation services and 36 percent in the rural areas (World
Bank, 2008). This explains why there is prevalence of diseases among the
rural poor in the country.
1.3 Research Questions
- What are the socio economic characteristics of the respondents in the study area?
- What are poverty statuses of the respondents in the study area?
- What are the factors influencing the welfare of the rural households?
- What are the determinants of poverty among the rural households?
1.4 Objectives of the Study
The broad objective of this study is to
analyze the poverty profile among rural households in Ido Local
Government area in Oyo State. The Specific objectives are to:
- describe the socio-economic characteristics of respondents in the study area;
- assess the poverty status of the respondents in the study area;
- examine the determinants of rural household’s poverty profile; and
- examine the factors influencing household per capita expenditure
1.5 Justification of the Study
Poverty is a global
issue of concern affecting both the developed and developing worlds (in
either relative or absolute terms), but felt most in the developing
world because it presents itself in absolute terms as a vicious circle
very difficult to break. This study is aimed at the following
- to the Federal Government, they can use this work to know the kind
of programmes to initiate so as to drastically reduce poverty striking
the rural masses.
- to the Researchers, this study will be very significant because it
will add to the existing literatures or research of work relating to
poverty profile among the rural households.