World Applied Sciences Journal 36 (5): 661-673, 2018
© IDOSI Publications, 2018
Corresponding Author: Uche M. Ozughalu, Department of Economics, Faculty of the Social Sciences,
University of Nigeria, Nsukka, Nigeria, Postal Code: 410001
Tel: +234-8067067548, E-mail: firstname.lastname@example.org; email@example.com.
Household Poverty and Food Expenditure in Nigeria:
An Empirical Test of Engel’s Law
Uche M. Ozughalu
Department of Economics, Faculty of the Social Sciences,
University of Nigeria, Nsukka, Nigeria
Abstract: Poverty and food consumption inadequacy are two major problems which have been afflicting the
world over the years, particularly in recent times. Nigeria is evidently plagued by the two problems. This study
analysed the association between household poverty and food expenditure in Nigeria. In particular, the study
empirically tested the validity of Engel’s Law within the framework of major poverty correlates. The study was
based on the 2010 Harmonised Nigeria Living Standard Survey data set obtained from the National Bureau of
Statistics, Abuja, Nigeria. The study used descriptive statistics and logistic regression technique in its analysis.
The study found, among other things, that, in general, food expenditure share varied directly with poverty
whereas food expenditure per capita varied inversely with poverty in Nigeria. This implies that while the poor
have higher food expenditure share than the non-poor, the non-poor have higher food expenditure in absolute
terms than the poor; this validates the Engel’s Law. The government should take urgent and adequate steps
to tremendously reduce poverty in Nigeria and guarantee adequate food expenditure for all and sundry in the
Key words: Food Expenditure Household Poverty Logit Nigeria
INTRODUCTION output, income and employment. With decline in output,
Poverty and food consumption inadequacy are two all other things being equal. Thus, inadequate food
major ways of describing economic adversity. These two consumption and poverty are intricately linked. Suffice it
principal socio-economic problems have been afflicting to say that inadequate food consumption has negative
the world over the years, particularly in recent times. The impact on health status and this in turn brings about
less developed regions of the globe are evidently worst many undesirable/detestable socio-economic conditions
hit by the two problems [1-6]. The level of poverty and such as low income, low life expectancy at birth, high
the magnitude of food consumption inadequacy are infant and under-five mortality rates, and low human
apparently most pronounced in Sub-Saharan Africa. In capability in general. It is worthy of note that adequate
fact, the region has evidently made the slowest progress food consumption contributes immensely towards making
in combating the two problems in question when a person remain a great and invaluable asset to the
compared to other regions. society. Among other things, it plays a crucial role in the
Food consumption is a major determinant of quality maintenance of good health and in the prevention of
of life. Inadequate food consumption leads to significant morbidity and premature mortality throughout the life
reduction in physical ability, cognitive/intellectual cycle [7, 8]. To show the critical importance of adequate
development, emotional and spiritual balance, and life food consumption, the first Millennium Development
expectancy. Indeed, inadequate food consumption Goal and the second Sustainable Development Goal are
ultimately leads to tremendous reduction in productivity on reducing/obliterating food consumption inadequacy
and reduction in productivity brings about decline in (Hunger).
income and employment, poverty is bound to increase,
World Appl. Sci. J., 36 (5): 661-673, 2018
This is contained in his address to the 21 Session of the Conference of Food and Agriculture Organization, 1981.
This refers to a collection of goods and services.
In Nigeria, poverty has become pervasive in recent services. The concern here is with an individual’s or a
times, afflicting an overwhelming proportion of the household’s ability to subsist and to reproduce
country’s population. Indeed, poverty has over the years himself/herself or itself as well as the individual’s or the
continued to devastate Nigeria and the country has in household’s ability to command resources to achieve this
recent times been shown to be one of the poorest in the . Historically, this involves a transition from a
world [3-6, 9-18]. Also, food consumption inadequacy is situation where subsistence depends on wages with
evidently highly pronounced in Nigeria and this is which to purchase food to a situation where subsistence
eloquently manifested in the high levels of severe and depends on wages/money income with which to purchase
moderate underweight, wasting and stunting among food and basic non-food commodities and services.
children coupled with the high rates of infant and Anyanwu  further pointed out that many other experts
under-five mortality as well as low life expectancy at birth have conceptualised the poor as that portion of the
[3-6, 9, 13-23]. population that is unable to meet basic nutritional needs
Objectives of the Study: The relationship between education, healthcare, life expectancy, child mortality and
poverty and food expenditure is crucial for development so on.
policy formulation and implementation. It is noteworthy The commonest (and perhaps the most celebrated)
that food expenditure is usually used as a proxy for food practice is to conceptualise poverty in absolute terms.
consumption. The broad objective of this study is to Absolute poverty, according to Pope John Paul II, is a
analyse the association between household poverty and condition in which life is so limited by lack of food,
food expenditure in Nigeria. The specific objectives malnutrition, illiteracy, high infant mortality and low life
include the following. expectancy as to beneath any rational definition of human
To empirically test the validity of Engel’s Law in decency. In line with the foregoing papal definition, the
Nigeria by empirically testing whether or not the ratio World Bank considers absolute poverty as a condition of
of food expenditure to total expenditure is positively life degraded by diseases, deprivation and squalor, among
related to poverty in the country. other things . In general, absolute poverty refers to
To empirically test whether or not per capita food lack of adequate resources to afford a
expenditure is inversely related to poverty in Nigeria. commodity/consumption basket that guarantees the
Literature Review acceptable standard of living . Even though the above
Theoretical Literature on Poverty: The concept of conceptualisation of poverty has some limitations, it is
poverty is very crucial to discussions in development noteworthy that conceptualising poverty in absolute
studies . Over the past few decades, experts in terms is most appropriate for the formulation and
Development Economics have given great attention to the implementation of policies and programmes that are aimed
concept in their attempt to explain the paradox of the at reducing the level of basic deprivation and misery .
coexistence of high rate of economic growth and high As further observed in Ozughalu  absolute
incidence of poverty. Poverty is a situation that is poverty is sometimes defined in terms of some
characterised by economic hardship and degradation of approximate maximum proportion of total income (or total
human dignity. However, the conceptualisation of the expenditure) that is spent by a household or an individual
phenomenon is highly problematic. This is largely due to on certain subsistence commodity (or commodities).
the fact that the phenomenon affects multiple aspects of Thus, in obedience to Engel’s Law, any household or
human condition including physical, psychological, social individual that spends more than a specified maximum
and even spiritual. This has made it impossible to have a percentage of its or his/her income on basic needs like
general consensus on the definition of the phenomenon. food, housing, clothing and healthcare is considered as
The literature is loaded with multifarious poor.
conceptualisations of poverty. Various criteria have been It could be recalled that a celebrated Statistician –
used to conceptualise the problem. Many analysts, who later became interested in Economics, particularly in
however, follow the conventional view that poverty is a studying food demand - Ernst Engel, stated a major result
result of inadequate income for securing basic goods and from his observations and studies; this result is known as
while others view poverty, in part, as a function of
attainment/ maintenance of an objective minimum
Engel’s Law. The law states that the poorer an individual, or permanent socio-economic deprivations and is linked
a family or a people, the greater must be the percentage of to various factors such as limited productive resources,
the income necessary for the maintenance of physical lack of education/skills for gainful employment and
sustenance and of this a greater portion must be allowed endemic socio-political and cultural factors. Transient
for food [27, 28]. Put differently, the law says that as poverty, on the other hand, is transitory or temporary and
income rises, the proportion of income spent on food falls, is linked to natural or man-made disasters such as wars,
but the absolute expenditure on food may rise. The law loss of jobs, conflagration, ill-health and flood [24, 36].
implies that the poor spend higher proportions of their In the analysis of poverty it is customary to start
incomes on food than the non-poor; thus, the ratio of by choosing an indicator of well-being. This may be
food expenditure to total expenditure should vary directly based on consumption, expenditure or income .
with poverty whereas the absolute expenditure on food Thereafter, a cut-off point, called “The poverty line” will
may vary inversely with poverty. be set. This is a measure of the minimum acceptable
Another major way of conceptualising poverty is in standard of living or welfare and it separates the poor
relative terms. Relative poverty refers to the inability of from the non-poor . Poverty lines can possess the
certain segments of a society to earn adequate income or attributes of specificity (or relevance) and comparability
to command resources to satisfy their basic needs in line (or consistency). Specificity (or relevance) of a poverty
with what obtains in the better-off segments . line across space at a particular time implies that the
We also have material poverty and subjective poverty line reflects the specific characters of a region
poverty. Material poverty refers to lack of ownership under study. It is held in many quarters that a poverty line
and control of physical assets such as land, machinery should take into account various aspects of human
and animal husbandry . Subjective poverty condition in a region such as life pattern, culture, social
conceptualisation, on the other hand, requires condition, and norms prevailing in the region . Inter-
individuals – the poor inclusive – to define what they temporal specificity (or relevance) of a poverty line, which
consider to be decent or minimally adequate standard of is similar to spatial specificity, implies that the poverty line
living . reflects the specific conditions/characteristics of a
We have the concept of exchange entitlement and particular region/area at a given time; it is popularly held
capabilities as an aspect of poverty which has some that the derivation of poverty lines across time should
similarities with material poverty. Exchange entitlement consider changes in the life pattern, culture, social
and capabilities as a poverty concept was designed in Sen conditions, and norms prevailing in different years [38-40].
 and Sen . In a market economy, exchange Consistency (or comparability) of poverty lines, on the
entitlement refers to the set of all alternative bundles of other hand, refers to when poverty lines indicate the same
commodities that can be acquired in exchange for what is standard of living [38, 40]. As pointed out in Asra and
owned. Given ownership, this exchange entitlement, Santos-Franscisco , some kind of standardisation
among other things, depends on earned income, asset needs to be undertaken to ensure strict comparability.
income, prices of consumption goods, prices of producer When money metric measures are used, they should be
goods, prices of inputs used and government’s social adjusted adequately for price differentials so that they
programmes and fiscal operations [31, 33]. On the other maintain a fixed real value that will make valid spatial or
hand, capabilities have to do with such elements as even inter-temporal comparisons of poverty rates. In other
standard of living and the broader aspects of the ability to words, to enable comparison, poverty lines based on
be socially useful and influential. The interaction of money metric measures should be fixed in terms of
entitlement and capabilities to a great extent determine standard of living across the entire domain of the poverty
what people do and what they are. Following this, a poor comparison .
person can be said to be one who, given the ownership he The construction of poverty lines is relatively
actually has, has an exchange entitlement set that does subjective and depends to a large extent on individual
not contain any feasible bundle of commodities satisfying researchers’ preferences and dispositions [41, 42].
minimum standard of living . However, the literature reveals that there are basically four
Poverty can be chronic (structural) or transient. approaches used in the setting of poverty lines namely:
Transient poverty relates to the contribution of Direct Calorie Intake (DCI), Food-Energy-Intake (FEI),
consumption variability to anticipated poverty over time Cost-of-Basic Needs (CBN) and Arbitrary-Choice-of-Index
whereas chronic poverty is the poverty that remains after (ACI) methods [38, 43,44]. It is instructive to state that the
inter-temporal variability in consumption has been FEI and the CBN methods are apparently more popular
smoothed out [34, 35]. Chronic poverty implies persistent and more scientific than the other two methods.
The Gini coefficient is a measure of dispersion and it is used in Economics to measure income inequality. It ranges from 0 (perfect
equality) to 1 (complete inequality).
After a poverty line has been set, the next line of that contains the headcount ratio, the poverty gap index
action will be to measure poverty. There are some axioms and a measure for poverty severity. The FGT index (P ) is
that a good and desirable poverty measure must satisfy. based on the following formula:
These include monotonicity, transfer and focus axioms
[25, 45]. The monotonicity axiom states that given other
things, a reduction in income (or expenditure) of a person (1)
that is below the poverty line must increase the poverty
measure. The transfer axiom states that, given other where: n is the total number of households/individuals in
things, a pure transfer of income ( or expenditure) from a the population or sample; y is the income or expenditure
person that is below the poverty line to any one that is of the i poor household/individual; z is the poverty line;
richer must increase the poverty measure. The focus and is the poverty aversion parameter. The poverty
axiom requires that the poverty measure be dependent aversion parameter ( ) is usually set at 0, 1 and 2 to
only on the incomes (or expenditures) of the poor; thus measure poverty headcount, poverty depth and poverty
the incomes (or expenditures) of the non-poor and any severity respectively. As stated earlier, the FGT index has
changes therein are irrelevant. the peculiar advantage of being additively decomposable
There are many poverty measures but four of them among population subgroups. Thus, the overall poverty
are commonly used namely: the headcount ratio, the (P ) can be expressed as the sum of group measures
poverty gap index, the Sen index and the Foster-Greer- weighted by the population share of each group [47, 48].
Thorbecke (FGT) index [24, 46]. The headcount ratio is the The decomposition may be given as follows:
commonest and simplest of all the existing poverty
measures. It is simply the proportion of poor people in a P = K P (2)
population. The headcount ratio pinpoints variations in
the percentage of the population living in poverty. But it where j = 1, 2, 3 … m groups; K is the population share of
is insensitive to the severity of poverty and to changes each group and P is the poverty measure of each group.
below the poverty line. The poverty gap index measures Based on (2), the contribution of each group (CN ) to
the difference between the poverty line and the mean overall poverty is calculated as follows:
income or expenditure of the poor expressed as a ratio of
the poverty line. It is a good measure of the depth of
poverty for it takes account of the extent to which (3)
households fall below the poverty line. But it is
insensitive to the distribution of standard of living among It is instructive to state here that money-metric
the poor. The Sen index is a composite measure of measures are usually preferred to non-money-metric
poverty. It indicates the degree of impoverishment and measures. This is because money-metric measures are less
the distribution of income among the poor as well as the subjective and more scientific than non-money metric
number of the poor. It incorporates the headcount ratio, measures. Besides, money-metric measures cover
the poverty gap index and the Gini coefficient. The Sen economic deprivation which is regarded as the principal
index satisfies the monotonicity, transfer and focus dimension of poverty.
axioms. However, a major shortcoming of the index is that It is regrettable to observe that despite the
it is more responsive to improvements in the headcount pervasiveness of poverty and the economic importance of
than it is to reductions in the income gap or to the phenomenon, economists have not been able to
improvements in the distribution of income among the formulate sophisticated and robust direct theories of the
poor; thus, it suggests that the best way to reduce menace. However, what appears like a direct theory of
poverty is to help the least needy first and the neediest poverty in Economics is the vicious cycle theory. This
last. This is not in line with moral justice and it is theory implies that poverty breads poverty, occurs
repugnant to equity and good conscience . The FGT through time and transmits its effects from one generation
index is apparently the most popular/most widely used to another [49-51]. The vicious cycle theory has both
poverty measure because apart from satisfying the major demand and supply sides. The demand side shows that
axioms for a desirable poverty measure, it has an added low productivity leads to low income and low income
advantage of being additively decomposable among brings about low demand; low demand leads to low
population subgroups. The index is a composite measure investment and low investment leads to capital deficiency
The components of food are carbohydrates, proteins, fats, vitamins, mineral and water.
which in turn brings about low productivity. On the A major concept associated with food expenditure is
supply side of the cycle, low productivity leads to low
income and low income leads to low saving which in turn
leads to low investment; low investment brings about
capital deficiency and this in turn brings about low
productivity. Another dimension of the vicious cycle
theory links market imperfections and underdeveloped
human and natural resources. Development of a country’s
natural resources is a function of the productive capacity
of the people in the country. If the people are backward
and illiterate, and lacking in technical skill, knowledge and
entrepreneurial ability, then the natural resources will tend
to remain unutilised, or be underutilised or even be
wrongly utilised; on the other hand, people are
economically backward in a country due to
underdeveloped natural resources . It is noteworthy
that underdeveloped human and natural resources pave
the way for gross market imperfections.
Political economists and radical sociologists/
psychologists have postulated some theories of poverty.
These theories include the necessity theory, the
individual attributes theory, the natural circumstantial
theories and the power theory . In contemporary
literature, many theories are found. However, five of these
are apparently most prominent. They are individual
deficiencies theory; culture theory; economic, political
and social distortions/discrimination theory; geographical
disparities theories; and cumulative and cyclical
interdependencies theory . The foregoing theories, in
general, show that poverty is multidimensional or
multifaceted. They also show that poverty comes as a
result of various forms of deprivation such as
deprivations in output, employment, income, food
expenditure, non-food expenditure, political power and
Food Consumption and Food Expenditure: Food
consumption is the intake of all components of food or
part thereof. Food expenditure, on the other hand, refers
to the action of spending funds to obtain food items for
consumption purposes. Thus, food expenditure and food
consumption are highly correlated; the former is indeed a
function of the latter and vice versa. Total food
expenditure is usually made up of purchased food and an
imputed value for consumption of own food products
[19, 20]. Total food consumption is also made up of
purchased food and consumption of own food products.
Sometimes food consumption and food expenditure are
used interchangeably. Suffice it to say that food
expenditure is monetary representation of food
food security. Food security exists when all people, at all
times, have physical, social and economic access to
adequate, safe and nutritious food that meets their
dietary needs and food preferences for an active and
healthy life [2, 54-56]; this may be said to be national or
aggregate food security. Household food security is the
application of the foregoing conceptualisation at the
household level, with individuals within the household
as the focus of concern . It is important to point out
here, following  that food security is not synonymous
with food self-sufficiency as erroneously held in
some quarters. Food self-sufficiency refers to a state of
affairs in which food requirement is satisfied by a
nation or household or individual through own
production activities without recourse to augmentation
through food imports, transfers or other external supply
Food insecurity and food expenditure deficits are
often considered to be mainly economic problems; thus,
economic approaches are usually used in analysing them.
There are many variables that can serve as indicators of
food security in the measurement and analysis of the
problem of food insecurity and food expenditure deficits.
These include net food availability per capita; per capita
calorie and/or protein intake; percentage of the population
or of households with energy intake that is below the
national average requirement; percentage of children
that are underweight, stunting and wasting (as may be
determined from anthropometric studies); food gap
which may be measured as the percentage shortfall in the
actual average energy intake relative to the average
energy requirement; coefficient of variation in daily
energy supply per capita; and index of food price inflation
[54, 55, 57]. Indicators that are expressed in per capita
terms may be expressed in per adult equivalence terms.
Recent literature on analysis of household welfare is
replete with the advocacy to always cater for variation in
household size and composition in the analysis of various
aspects of household wellbeing such as household food
expenditure and household income and consumption
poverty. Ways of addressing the issue of variation in
household size and composition include the use of adult
equivalence scales and economies of scale in household
consumption [58-61]. However, when such measures are
not available or reliable, then the use of per capita
measures becomes inevitable.
One of the commonest measures of national food
security status is net food availability per capita (NFAC )
and it is defined as follows [See 54]:
t t t t tt t
NFAC QY FM DNFS TQF FX QPHF n
= + + − −−
To access a household’s food expenditure adequacy,
(4) expenditure with a predetermined objective standard
where: NFAC is net food availability per capita (in grain expenditure is less than the standard minimum
equivalence) in year t; QY is domestic output of food in requirement it will then be said that the household’s food
year t; FM is quantity of food imported in year t; DNFS expenditure is inadequate. This approach is apparently
is change in national food stock carry-over in year t; TQF very popular among researchers.
is total quantity of food required as inputs and for non- Standard consumption theories show a positive
food industrial use in year t; FX is quantity of food relationship between expenditure and income. For
exported in year t; QPHF is quantity of post-harvest loss instance, the Keynesian absolute income hypothesis
in year t; and n is population size. states that consumption is a positive function of
At the household level, food security and food disposable income . Thus, when disposable income
expenditure adequacy can be measured directly by actual increases, expenditure – of which food expenditure is a
dietary intake of all household members or by household major component – also increases. Standard consumption
food expenditure, using standard household expenditure theories, in general, imply that expenditure (including food
and income surveys; the degree of household food expenditure) is inversely related to poverty. Those that
security depends, among other things, on the minimal are poor spend less on food (and other consumption
nutritional requirements of individuals with the goods) in absolute terms than the non-poor; the poor are
assumption that all households with in each usually food insecure; indeed, the poor often lack
expenditure/income stratum have the same entitlements to adequate means to secure access to sufficient food
food [62, 63]. [55, 65]. Inadequate food expenditure is truly a
Due to the inadequacy of single variables as manifestation of poverty. However, as indicated earlier,
indicators of food security and food expenditure though the poor may spend less on food than the non-
adequacy status, attempts have been made to construct poor in absolute terms, the proportion of income spent on
composite food security status. For instance  has food by the poor is in general higher than that spent by
proposed that such indices should be constructed using the non-poor, which is in line with Engel’s Law .
the following variables: per capita food supply; national
income per capita; index of income distribution which may Empirical Literature: Empirical studies on the
be measured by Gini coefficient computed from a relationship between poverty and food expenditure as
frequency distribution of national income or, as a proxy, well as on related issues across the world are relatively
the percentage of national income received by the lowest scanty. Such studies include [41, 42, 67-72]. Crawford and
40 per cent of the population; deviation of food Thorbecke  used a low-cost diet and direct calorie
production from trend; and index of food prices. intake approach to estimate the magnitude and regional
The Food and Agriculture Organization (FAO) has distribution of food poverty among Kenyan smallholders.
developed a sophisticated index for capturing food The study found, among other things, that one-fourth of
security and food consumption adequacy. The FAO index all smallholder-households had a food intake that was
is called Aggregate Household Food Security Index below the recommended daily allowance and there were
(AHFSI) and is given as follows [See 54]: notable differences in the provincial incidence of food
AHFSI = [H[G + (1-G)] + ½ [1-H[G+(1-G)I]]100 (5) Thorbecke  used a novel methodology involving an
where: H is proportion of undernourished people (or poverty measure associated with the Foster-Greer-
households) in the population; G is food gap measured as Thorbecke (FGT) index to analyse food consumption
the proportion of the shortfall of average daily energy shortfalls among Kenyan smallholders. Greer and
intake by the undernourished from the average national Thorbecke  also used multiple regressions techniques
energy requirement; I is a measure of inequality in the to establish the correlates of calorie consumption.
distribution of food gap, represented by Gini coefficient The study found, among other things, that there were
obtained from the assumed distribution of per capita food regional differences in the severity of food poverty and
consumption; is coefficient of variation in energy household income (with expenditure used as proxy for it)
supply. per adult equivalence was the primary determinant of
one has to compare the household’s actual food
minimum requirement. If the household’s actual food
poverty. Greer and Thorbecke  and Greer and
empirically derived cost-of-calories function and a
calorie consumption. Greer and Thorbecke  found, security situation among urban households in Lagos
among other things, that the methodology of the study
was superior in some ways to least-cost approach and
that at low expenditure level Kenyans appeared to be very
cost efficient food consumers.
Kyereme and Thorbecke  like [41, 42] also used an
empirically derived cost-of-calories function and a
poverty measure associated with the Foster-Greer-
Thorbecke (FGT) index to analyse food poverty using the
Ghana Household Budget Survey data of 1974-1975. The
study found, among other things, that the incidence of
food poverty was more prevalent in rural areas and
locations close to the Sahel as well as among households
with many members and illiterates, females or self-
employed heads. Kyereme and Thorbecke  employed
multiple regression technique based on household
production theory to identify the main determinants of
food poverty in Ghana. The study found, among other
things, that age of household head, sex of household
head, educational level of household head, income,
fertility and maturity indices significantly explained
household calorie gaps. The study used the Ghana
Household Budget Survey. Nyariki and Wiggins 
used household data to analyse food security and food
poverty. The study employed simple ratio techniques and
showed that per capita food production was low in Kenya
and varied with rainfall and food poverty; and insufficient
food expenditure brought about food poverty. This
implies that poverty and food expenditure are directly
related. Kumar and Aggarwal  investigated the
patterns of consumption and poverty in Delhi based on
survey data. The study also employed simple ratio
techniques. The study found, among other things, that
the poor, in general, spent a highly significant proportion
of their income on food. Mussa  used the 2005 Second
Integrated Household Survey data on Malawi to examine
how inequality in household expenditure components
affected total inequality and poverty in the country. The
study disaggregated total household expenditure into
four mutually exclusive and exhaustive expenditure items
namely expenditure on food, expenditure on health,
expenditure on education and expenditure on non-food
and non-human capital items. The study utilised within-
component inequality and between-component inequality
measures and found, among other things, that the
elasticities of poverty with respect to inequalities in
expenditure on food and health were positive and about
the same in magnitude.
Empirical studies associated with poverty and food
expenditure in Nigeria are also very scanty. They Include
[73-79]. Omonona and Agoi  analysed the food
State, Nigeria, based on primary data that were obtained
from structured questionnaire in 2004. The study found,
among other things, that the food insecurity incidence in
the study area was 49%; it varied directly with age of
household head, household size and dependency ratio; it
varied inversely with level of education and income; it
was higher in female-headed households than in male-
headed households; it was found to be low for those
engaged in professional occupation and highest for
traders. Obayelu et al.  used food consumption data
obtained from a household survey carried out between
November 2006 and February 2007 to examine whether or
not there were differences in food consumption patterns
between the rural and urban households in North Central
Zone of Nigeria. The study utilised descriptive statistics
and Cragg double-hurdle model and found, among other
things, that there was heterogeneity in food consumption
and expenditure patterns across households in rural and
urban areas. Obayelu et al. , used data obtained from
a household survey conducted between 2006 and 2007 to
analyse differentials in households’ food expenditure
between urban and rural households in Kogi and Kwara
States of Nigeria. The study employed descriptive
statistics and found, among other things, that households
in urban areas spent higher proportions of their incomes
on food than households in rural areas. The study further
showed that female-headed households spent slightly
higher proportions of their incomes on food than male-
headed households; and food expenditure share
increased with increase in household size but decreased
with increase in household per capita income in line with
Engel’s Law. Babalola and Isitor  used data got from
a household survey that was carried out in 2012 to
analyse the determinants of food expenditure patterns
among urban households in Lagos State, Nigeria. The
study made use of descriptive statistics and a multiple
regression model. The study found, among other things,
that 60% of household income was spent on food and
that the major determinants of food expenditure included
household income, household size and household
composition. Ozughalu and Ogwumike  used the 2004
Nigeria Living Standard Survey data to examine the
incidence, depth and severity of food poverty in Nigeria,
and to produce a food poverty profile for the country. The
study utilised a linear programming technique in the spirit
of the Food-Energy-Intake approach as well as the Foster-
Greer-Thorbecke (FGT) index. The study, among other
things, showed that food poverty was pervasive in
Nigeria and varied significantly across the geo-political
01 2 3
45 6 7
8 9 10
L SHH AHH AHH
HS HS RUR NN
EHH RFT PFE
= =++ +
+ ++ +
zones of the country. Ozughalu and Ogwumike  used a simple approximation to other probability models;
the 2004 Nigeria Living Standard Survey data and logistic
regression technique to analyse the determinants of food
poverty in Nigeria. The study found, among other things,
that household size, proportion of children in the
household, occupation in agriculture for household head
and residing in the rural sector were positively related to
food poverty whereas ownership of agricultural land,
educational level of household head, occupation in
professional/technical group and in administration/clerical
group for household head, access to credit and access to
regular remittances were inversely related to food poverty.
Olubukunmi et al.  used the 2010 Harmonised Nigeria
Living Standard Survey data, descriptive statistics, a
multiple regression model and an ordered probit model to
analyse food and non-food expenditure differentials
across poor and non-poor households in South East Zone
of Nigeria. The study, found among other things, that
there were significant variations in food and non-food
expenditures across poor and non-poor households in
South East Zone of Nigeria; the non-poor spent far more
on both food and non-food items in absolute terms than
It is pertinent to note that none of the studies
reviewed comprehensively analysed the relationship
between household poverty and food expenditure using
a nationally representative data. Suffice it to say that
analysing the relationship between household poverty
and food expenditure is crucial for both theoretical and
MATERIALS AND METHODS
To analyse the association between household
poverty and food expenditure in Nigeria, we employ some
descriptive statistics as well as a logit model, and we
utilise the 2010 Harmonised Nigeria Living Standard
Survey (HNLSS) data set obtained from the National
Bureau of Statistics, Abuja, Nigeria. The descriptive
statistics that will be used are arithmetic mean (or simply
the mean), standard deviation and coefficient of variation.
The mean is a measure of central tendency; standard
deviation is a measure of absolute dispersion or
variability; and coefficient of variation is a measure of
relative dispersion or variability. Coming to logit model, it
involves a maximum likelihood estimator of stated
parameters given the non-linear probability distribution of
the random error. The logit model is mathematically very
convenient thus it may generally be preferred to its rivals
such as Probit Model. The logit model can be applied as
the model is known to produce results that can
easily be interpreted and the method is simple to
analyse; it even permits interpretations in utility terms
. The logit model is known to produce statistically
sound results [81, 82]. In fact, the parameter estimates of
the logit model are asymptotically efficient, consistent and
normal and the analogue of the regression t-test can be
The logit model for this study is specified explicitly
where: L is the logit (that is, the natural logarithm of the
odds ratio); P = 1 if household is poor and P = 0 if
household is not poor; is simply the odds ratio in
favour of being in poverty; a household is said to be poor
if its per capita expenditure is less than two-thirds of mean
per capita household expenditure in regionally deflated
prices; is the constant term; SHH is sex of household
head (male = 1, female = 0); AHH is age of household
head (in years); AHH is square of age of household
head; HS is household size; HS is square of household
size; RUR is residing in rural sector (yes=1, no=0); NN is
residing in Northern Nigeria (yes=1, no=0); EHH is
educational level of household head (in terms of years of
formal schooling); RFT is ratio of food expenditure to total
expenditure (in %); PFE is per capita food expenditure;
and is the random error term. The a priori expectations
are as follows:
, , , and > 0; , , and < 0.
01,3 56,7 9 248 10
Suffice it to say that SHH, AHH, AHH , HS, HS , EHH,
RUR (or area of residence) and NN (or region of
residence) are major determinants of poverty [see 83-85].
RFT and PFE are included in order to analyse the effects
of food share (in total expenditure) and absolute food
expenditure on poverty.
RESULTS AND DISCUSSION
Table 1 shows the mean, standard deviation and
coefficient of variation of ratio of food expenditure to total
expenditure and per capita food expenditure for core
This refers to any household whose per capita expenditure is less than one-third of household mean per capita expenditure in
regionally deflated prices.
The refers to any household whose per capita expenditure is up to and above one-third of household mean per capita expenditure
but less than two-thirds of household mean per capita expenditure in regionally deflated prices.
The Logit becomes negative and increasingly large in magnitude as the odds ratio decreases from 1 to 0 and becomes increasingly
large and positive as the odds ratio increases from 1 to infinity [see 82].
Table 1: Descriptive Statistics of Ratio of Food Expenditure to Total Expenditure and Per Capita Food Expenditure for Core Poor, Moderately Poor and Non-
Mean(N) Standard Deviation Coefficient of Variation (%)
Ratio of Food Expenditure to Total Expenditure 59.68 25.12 42.09
Per Capita Food Expenditure 11,593.85 7,001.05 60.39
Ratio of Food Expenditure to Total Expenditure 52.13 27.34 52.45
Per Capita Food Expenditure 24,530.97 13,780.81 56.18
Ratio of Food Expenditure to Total Expenditure 36.80 29.69 80.68
Per Capita Food Expenditure 48,936.39 53,948.84 110.24
Source: Computed by the author from 2010 HNLSS
Table 2: Logistic Regression Estimates for Equation 6
Variable B S.E Sig Exp (B)
SHH 1.306* 0.045 0.000 3.692
AHH -0.788* 0.010 0.000 0.455
AHH 0.009* 0.000 0.000 1.009
HS -1.537* 0.057 0.000 0.215
HS 0.087* 0.005 0.000 1.091
RUR 2.642* 0.045 0.000 14.040
NN 0.681* 0.052 0.000 1.976
EHH -0.023* 0.004 0.000 0.977
RFT 135.798* 0.744 0.000 9.469E+58
PFE -0.203* 0.001 0.000 0.816
Constant 17.060* 0.246 0.000 25638608.39
Cox & Snell R =0.728; Likelihood Ratio Statistic=120,865,292; P-value for Likelihood Ratio Statistic(which follows the x distribution) =0.000
Source: Computed by the author from 2010 HNLSS. The single star (*) indicates that the parameter estimate is statistically significant at 1%. Note: B
represents each of the parameter estimates; S.E stands for standard error associated with each parameter estimate; Sig stands for significance level or the
probability value associated with each parameter estimate; Exp(B) represents the odds ratio associated with each parameter estimate (This is obtained by taking
the natural antilogarithm of each of the parameter estimates) .
poor , moderately poor and non-poor. The table indicates is most variable and least consistent for the non-poor.
that the ratio of food expenditure to total expenditure The table further shows that the non-poor have the
varies inversely with poverty whereas per capita food highest coefficient of variation associated with per capita
expenditure varies directly with poverty. The core poor food expenditure followed by the core poor; and the
have the highest mean ratio of food expenditure to total moderately poor have the lowest coefficient of variation
expenditure followed by the moderately poor; the non- associated with per capita food expenditure; this implies
poor have the least mean ratio of food expenditure to total that the distribution of per capita food expenditure is most
expenditure. This validates the Engel’s Law. On the other variable and least consistent for the non-poor while it is
hand, the non-poor have the highest mean per capita food least variable and most consistent for the moderately
expenditure followed by the moderately poor; the core poor.
poor have the lowest mean per capita food expenditure. Table 2 shows the logistic regression estimates of
With regard to variability, the table shows that the core Equation 6. The estimates are generally robust; all the
poor have the lowest coefficient of variation associated explanatory variables, on aggregate, have significant
with ratio of food expenditure to total expenditure impact on poverty in Nigeria. This is shown by the fact
followed by the moderately poor; and the non-poor have that the likelihood ratio statistic is statistically significant
the highest coefficient of variation associated with ratio at 1%. A pseudo R - the Cox & Snell R – is presented; its
of food expenditure to total expenditure; this implies that value is 0.728 and it indicates satisfactory goodness of fit
the distribution of food share in total expenditure is least for the model. However, as noted in Gujarati and Porter
variable and most consistent for the core poor whereas it , in models with binary dependent variables, goodness
of fit is of secondary importance. What matters are the to all and sundry in the country; this will guarantee
signs of the regression coefficients and their statistical adequate food expenditure by the poor and it will go a
and/or practical significance. Virtually all the parameter long way in reducing the incidence of poverty in the
estimates have the expected a priori signs. country. Agricultural production should be adequately
As can be seen from Table 2, the ratio of food boosted and mechanisms for optimal distribution of
expenditure to total expenditure (RFT) is positively related agricultural products should be put in place. Indeed,
to poverty; it increases the odds in favour of being in agriculture should be made to become highly lucrative
poverty. This implies that poor households, on the and agriculturalists should be adequately supported.
average, have higher ratio of food expenditure to total Nigeria aims at becoming one of the twenty leading
expenditure than non-poor households; this also economies in the world within a short time. Achieving this
validates the Engel’s Law. Per capita food expenditure is objective cannot be guaranteed when there is pervasive
inversely related to poverty; it reduces the odds in favour poverty and when food expenditure is inadequate. Thus,
of being in poverty. This implies that, in general, non-poor to break the yoke of underdevelopment in Nigeria the
households have higher food expenditure in absolute government should ensure that absolute poverty is
terms than poor households; this is in line with obliterated and that adequate food expenditure for all and
expectation. sundry in the country is guaranteed. In addition to the
The table also shows that being a female has lower foregoing, other steps such as ensuring that household
odds associated with being in poverty compared to being heads have adequate education, ensuring that
a male. Age of household head is inversely related to households have optimum sizes as well as ensuring
poverty, while the square of age of household head is adequate rural sector development and development of
directly related to poverty. This means that as the age of Northern Nigeria should be taken.
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