Issues of Horizontal Inequality: A Case Study in Migrant Households

R.M.K.M.Lakmini and J. Weerahewa

Department of Agricultural Economics and Business ManagementFaculty of Agriculture

University of Peradeniya

1

Introduction

• Horizontal Inequality• Estate Sector• How Estate Sector differ from other two sectors in

the country???– Income– Food ratio– Poverty– Population contribution

• Thereby Estate Sector is considered as a unique segment of an underprivileged community.

2

Introduction Contd.

• People tend to move out from estate employment both locally & overseas.

• Within non-estate employment, overseas employment, predominantly in the Middle East was a key agent of change (CEPA, 2005)

• BUT do all of them achieve success?

3

Objective

• To investigate the extent to which socio-economic characteristics influence the expenditure pattern.– To compare expenditure behavior of better-off and worse-

off migrant households as perceived by the society in terms of budget share allocation for different expenditure categories

4

Methodology

• Sampling framework – List of female migrant households obtained from divisional office from Kiribathgala estate in Rathnapura

• Sample size - 52

• Key Informants Evaluation

• Stratification of better off and worse off households

• Questionnaire Survey - Structured questionnaire

5

From the questionnaire,

Socio –economic factors

Information on migration process

Information on following expenditure items,

FoodEducation Consumer DurablesHousingHousehold utilities

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Methodology Contd.

Method of Analysis Budget shares were calculated using,

ABS = Ci ∕ INCi Factors affecting budget share allocation for different expenditure categories were estimated by using Working-Leser Model.

Ci /INC = βi + γi (logINC) + λij( Zj)+ ε

Ci = Household expenditure on one of expenditure items during migratory period

INC = Total income during migratory period

Zj = Vector of the household characteristic variable

ε = Error term7

Results

8

General Sample Characteristics

9

Results Contd.

10

Results Contd.

Major reasons Percentage

Insufficient income 57.7

Better job/income 9.6

Indebtness 38.5

Housing 65.4

Children education 30.8

To save 3.8

Personal reasons 15.4

Major reasons for migration

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Results Contd.

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Results Contd.

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Results Contd.

14

Results Contd.

• Average Budget Shares on Expenditure for Better-off and Worse-off Households

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Results Contd.

• Regression Results

Variable Food Education Housing Consumer Durables Utilities

Log of total household income(Rs) -0.071** 0.025 0.003 0.0436 0.023Household Size 0.022* -0.021 -0.02 -0.033*** -0.002Age of household head(years) 0.0004 -0.001 -0.004 -0.002 0.002*Sex of household head 0.088 -0.075 -0.131* -0.141*** 0.06**Number children in household less than 5 years -0.002 -0.045 -0.036 -0.016 0.001Education level of household head -0.036*** 0.008 0.006 0.002 -0.015***Employment -0.021 0.0276 0.031 0.023 -0.011Receipts of Social transfers 0.012 0.0405 -0.00009 0.039 -0.0005Number of migrations -0.009 -0.0009 -0.012 -0.044* -0.033**Dummy for worse/better off -0.043* 0.0561* -0.041 0.09* -0.008**Adjusted R2 0.593 0.328 0.283 0.466 0.436

* - Significant at 10% Confidence Interval** - Significant at 5% Confidence Interval*** - Significant at 1% Confidence Interval

Conclusion

• There is a difference between better off and worse off households

• The better off households spend less on consumption food and utilities and more on education and consumer durables than worse off households

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Thank you

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