Assessing the Impact of Massive Out-Migration on Agriculture

Over the past several years, rural areas in transition countries have experienced a structural transformation of their agricultural sectors combined with profound demographic changes, primarily due to massive out-migration towards urban areas and abroad. Despite the potential relevance of migration – and the resulting remittances – in fostering, or hindering, transformation in agriculture, very little is understood about the linkages between these activities. Using data from two waves of the Albania Panel Survey carried out between 2002 and 2003, this paper is an attempt to contribute to a better understanding of the role migration has played in the re-allocation of resources in agriculture among migrant families in Albania, a country which epitomizes the power of change associated with out-migration. As per the hypothesis, our findings suggest that migration exerts a strong downward pressure on agricultural labor per capita. However, the evidence also suggests that the loss in household labor in agriculture is compensated by increased access to capital, leading to overall improvements in both agricultural and total incomes.