The Effect of Remittances on Sorghum Production
Date
2021-08-06
Authors
Dedewanou, Finagnon A.
Tossou, Rolande C. B. Kpekou
Journal Title
Journal ISSN
Volume Title
Publisher
African Economic Research Consortium
Abstract
The large increase in remittances from migrants has generated optimism about the
potential development benefits of these capital flows in rural communities where
capital market failures are prevalent. This paper examines the causal effect of
remittances on sorghum production by using the 2014 Living Standards Measurement
Study (LSMS) dataset on Burkina Faso. We use a Bayesian instrumental variables
approach to explore several specific pathways. The results show that land size, the
number of workers and the quantity of herbicide used are the factors that significantly
improve sorghum production in Burkina Faso. We also find that a 1% increase in the
amount of remittances leads to a 0.938% decrease in production of sorghum. We
suggest that public policies aimed at improving agricultural productivity will be more
effective if there is a remittance use scheme in place, along with the transparency of
decision-making concerning land allocation.