Savings And Investment Patterns Of Food Crops Farm-Households In The Ijebu Division Of Ogun State, Nigeria

Abstract

This paper analysed the savings-investment patterns of farm-households in the Ijebu Division of Ogun State, Nigeria. Specifically, the study analysed the socio-economic characteristics, and the fund allocation and savings-investment patterns of farm-households in the Ijebu Division. Cross-sectional data were collected from 100 farm-households in the study area. The data were analysed using diverse econometric methods. Results indicated that savings at home was a very common practice among the farm-households that constituted the study sample. The level of savings was influenced positively by the size of the working members of the farm-household. Income and interest rates on cycle savings also affected, albeit positively, household savings; although only one-tenth of any additional income is allotted to meeting the consumption needs of the farm-household. Household investment on the farm was also, influenced positively by the level of the household income. The interest elasticity of savings was 4.24 while that with respect to investment was found to be –7.26. Moreover, policy simulations carried out in the study indicated wide scope for mobilizing savings and for improving investment outlay at the farm-household level. The basic requirements, however, are well-designed income and interest rates policies, and aggressive savings mobilization and investment promotion at the farm-household level.

Keywords: savings and investment patterns, food crops

Journal of Agriculture and Social Research Vol. 7 (1) 2007: pp. 11-22