Relative effect of food and cash remittances on household food security

Abstract

Considerable policy consensus concerning cash remittance as an operational model in the household food security policy dialogue has been established, yet, little knowledge base exists with regard to food remittances and its effect on food security. In view of this, the study focused on food remittance against the backdrop of remittance and food security. Specifically, the study examined spatial variability in food security outcomes across districts in Ghana, the impact of food remittance on household food security and the relative effect of food and cash remittance on household food security. Using the seventh round of the Ghana Living Standard Survey, the study employed spatial autocorrelation techniques to analyse the spatial dependence of food security outcomes, Propensity Score Matching, Endogenous Switching Regression and Instrumental Variable estimation to account for the issue of endogeneity associated with food remittance. The study disclosed significant spatial dependence and clustering of food security outcomes and revealed that aside most districts in northern Ghana experiencing high levels of food insecurity, some districts in the food dominance zone of the country relatively have high food insecurity outcome. The study revealed a significant positive impact of food remittance on food security. Again, an additional amount of food received reduces food insecurity by a greater magnitude relative to the effect from a cedi increase in the amount of cash received. In addition, food remittance was vital for food insecurity reduction in rural than in urban areas. The study recommended that policies targeted at remittance should be broadened to include strategies that enrich food transfers. Also, food transfers should be targeted at food insecure districts, particularly rural areas in such districts