The Impact Of Remittance Receipts On Agricultural Asset Accumulation: Evidence From Ghana

ABSTRACT

In the remittance literature, the empirical relationship between remittance receipts and

agricultural asset accumulation has not been fully explored, and no clear-cut findings have been

established. This is even worse for the sub-Saharan region and particularly for Ghana where

little or no studies have examined such connection. Most of the efforts are geared towards Latin

America and the Caribbean (LAC), and Asian countries. The purpose of this study, therefore,

is to explore the impact that remittance receipts have on the household accumulation of

agricultural assets in Ghana. Using data from the sixth round of the Ghana Living Standards

Survey, the study controls for selectivity bias inherent in remittance receipts by employing

treatment effect estimators to investigate the connection between remittance receipts and asset

accumulation. In addition to this, the study examines the factors influencing household asset

ownership by using a Probit model. In the analysis of asset ownership, with the exception of

household income, which significantly influences only the accumulation of farmland, all other

variables significantly influence the household ownership of agricultural assets. Further, the

results also suggest that the receipts of only international remittances significantly affect the

household accumulation of farmland and livestock but not agricultural equipment. Thus, the

receipts of only international remittances increase the household accumulation of farmland and

livestock. However, the receipts of overall remittance (both international and domestic

remittances) and the receipts of only domestic remittances do not increase the household

accumulation of any form of agricultural asset.

Keywords: Remittances, Treatment Effect Model, Agricultural Assets