Effects of labour migration on productivity and technical efficiency in rice farming in Kanchanpur, Nepal

Abstract

Labor migration for employment is one of the most significant economic phenomena in a country like Nepal. However, there is no consensus among past studies on whether smallholder agricultural systems are deteriorated, are reinforced or remain unchanged due to the labour migration for foreign employment and the remittance received. This study aims to examine the effects of labour migration for foreign employment on productivity and technical efficiency of rice farmers applying it to the case of Nepal.

The study is based on primary data obtained through cross sectional single-visit survey of randomly selected representative samples of migrant and non-migrant households during January 2022. Sample for the study consist of 140 households, comprising 67 migrants and 73 non-migrant households. The study employed Cobb-Douglas production function and stochastic production frontier analysis to estimate productivity and technical efficiency respectively. T-test was conducted to see the difference between the socioeconomic and farm-related characteristics of migrant and non-migrant households.

The study found that the average yield of rice was lower in the migrant households than

that

of non-migrant households. The mean value of marginal productivity of land was estimated 0.89 quintal per kattha for migrant households and 1 quintal per kattha for nonmigrant households. The mean value of average productivity was estimated 1.33 quintal

and

1.43 quintal for migrant and non-migrant households, respectively. Similarly, the estimated mean technical efficiency level was 82 percent for migrant household and 94 percent for non-migrant households. Moreover, the migrant households lagged behind in socio-economic and farm-related characteristics including land holding, access to irrigation, mechanization, education, use of inputs and output compared to non-migrant households.

Based on the findings of the study, it can be concluded that labour migration for foreign employment has negative effect on farm productivity and technical efficiency. There is a need for more in-depth analysis at a greater scale.