Food vs Fuel: Can Biofuels Improve the Incomes of Rural Farmers in Nigeria?

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Abstract/Contents

Abstract: In 2007, the Nigerian government made plans to develop a biofuel sector to reduce dependence on imported gasoline and improve the welfare of farmers. This paper investigates the effect of biofuel on rural farmers’ incomes. In Nigeria, 70% of the 150 million inhabitants are employed in the Agricultural sector; the majority are farmers, many of which are low skilled, low income and reside in underdeveloped areas. When biofuels are introduced in any society, farmers experience a trade off between increased revenue from biofuel sales and increased food expenditures as food prices rise, thus an increase in their income is not inevitable. The Nigerian government appears to be neglecting the consequences of this trade off; officials consistently highlight that the increased demand for biofuel will increase farmers incomes, while ignoring potential negative consequences. I run simulations to determine whether farmers can realize positive net income without jeopardizing ethanol production and my results indicate that this is possible. However, the result depends on how consumption demand and biofuel production interact with the price of biofuel.

Type of resource	text
Date created	June 2011

Author	Sunmonu, Aminat Omotola
Primary advisor	Rothwell, Geoffrey
Degree granting institution	Stanford University, Department of Economics

Subject	Stanford Department of Economics
Subject	biofuels
Subject	Nigeria
Subject	rural poverty
Subject	ethanol
Subject	rural economy
Genre	Thesis

Location	https://purl.stanford.edu/fc661cb5240

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Preferred Citation: Sunmonu, Aminat Omotola. (2011). Food vs Fuel: Can Biofuels Improve the Incomes of Rural Farmers in Nigeria?. Stanford Digital Repository. Available at: https://purl.stanford.edu/fc661cb5240

Stanford University, Department of Economics, Honors Theses

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