Income distribution pattern among cocoa farmers in Abia State, Nigeria: The lorenze curve and mean per capita household expenditure approach

Abstract

The project probed the pattern of income distribution and poverty status among Cocoa farmers in Abia State, Nigeria using Lorenze curve and the mean per capita household expenditure (MPCHE) approach. Graph of the Lorenze curve and calculation of the Gini coefficient from the MPCHE of the Cocoa farmers shows that income was unequally distributed among the Cocoa farmers in Abia State; hence, there was an increasing gap between the poor and the rich Cocoa farmers in the study area. The Pearson correlation analysis between income and poverty of the Cocoa farmers was positive, with a correlation coefficient of 0.676; implying that a one-unit decrease in income inequality will result in a 67.6% decrease in poverty level. Since there was a high level of income inequality among the Cocoa farmers, the bottom 20% of the poor farmers should be encouraged to form cooperatives in order to access credit facilities from the government and other institutions. The government should also provide subsidies and grants to the bottom poor farmers to boost their production causing decreased income inequality and poverty level.