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close this bookFood and Nutrition Bulletin Volume 12, Number 4, 1990 (UNU, 1990, 72 p.)
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View the documentEffects of agricultural commercialization on land tenure, household resource allocation, and nutrition in the Philippines

Effects of agricultural commercialization on land tenure, household resource allocation, and nutrition in the Philippines

Howarth E. Bouis and Lawrence J. Haddad


Over the past several years, IFPRI has undertaken research on the effects on production, consumption, and nutrition of agricultural commercialization in the Gambia, Guatemala, the Philippines, and Rwanda. While it is widely recognized that the commercialization of agriculture is essential to overall economic development, various rural population groups adapt differently to the process of commercialization, depending on the resources available to them, economic and social conditions, and government policies.

This report presents the findings for the Philippine case study. Approximately 500 corn- and sugar-producing households were surveyed four times at four-month intervals during 1984 and 1985 in Bukidnon Province, on the island of Mindanao, an area primarily engaged in semi-subsistence corn production before the establishment of a sugar mill in 1977. The sample included small landowner, tenant, and landless labourer households. Data were collected on landholdings, income sources, expenditure patterns, calorie intakes, and nutritional status.

An initial random sample of households, both far away from the sugar mill (households that did not have the opportunity of switching to sugar because of the high cost of transporting cane to the mill) and close to the mill, indicated a serious deterioration in land tenancy patterns as a result of the introduction of sugar. Whereas landless households accounted for less than 5% of households engaged primarily in corn production, nearly 50% of households employed in sugar production had no access to land. When households engaged in sugar production were asked to characterize their tenancy status before the introduction of sugar seven years earlier, the pattern of distribution that emerged between owner, share tenant, and landless labourer households was very similar to the present pattern for corn households. Several former corn tenant households had lost access to land when landlords who had decided to grow sugar cane chose to hire labour for the new crop rather than rent out land on a share-of-harvest basis, as had been the custom with corn.

This report is adapted from the foreword and summary of IFPRI Research Report no. 79, which was written in collaboration with the Research Institute for Mindanao Culture. The complete report is available from IFPRI, 1776 Massachusetts Ave., NW, Washington, DC 20036, USA.

The detailed survey data show that small sugar cane landowners and renters who kept their land made substantially higher profits per hectare than their corn-household counterparts (an average of US$225 per ha per year for sugar compared with US$100 for corn) despite the low prevailing world prices for sugar, which to some extent were transmitted to the domestic market. The higher profits for sugar are in part a reflection of the low and declining productivity of corn. The primarily migrant population reported that corn yields, because of declining soil fertility, were about half of what they had been when they first settled their land. Despite this, all sugar households with access to land continued to plant some land with corn and, on average, produced well in excess of their household needs.

On average, about two-thirds of the labour devoted to corn production was provided by the family and one-third was hired. These ratios between family and hired labour were reversed for sugar production. Women contributed 23% of the total labour for corn production, but only 11% of the total labour for sugar production.

Sugar households had higher incomes on average than corn households, due partly to higher profits from sugar and partly to larger landholdings, although for most households, sources of incomes were highly diversified with 29% of all incomes coming from nonagricultural sources. The income elasticity for food expenditures at the mean for all sample households was estimated to be 0.65, so that food expenditures rose rapidly with income. As higher-priced calories were purchased by higher-income households, however, a doubling of income at mean income levels led to only an 11% increase in calorie intake at the house hold level. A substantial portion of the extra calories that were available at higher incomes went to adults, who were already meeting their recommended intake of calories. Pre-school children (once breast-feeding had been stopped) at all income levels consumed well below their recommended calorie intake.

A strong association existed between income and height for age, a long-run measure of nutritional status, for children less than one year old. However, this association between income and height for age is weak for preschoolers at four years of age, which means that height for age deteriorates (relative to average heights for a reference, well-nourished population) much faster for higher-income children than for lower-income children as they grow older. This aggregate pattern is more pronounced for the higher-income sugar households. Pre-school children who are four years of age from households without access to land (corn and sugar landless labourer households) are significantly more stunted than children of the same age in households with access to land, reflecting in part the low availability of calories in these landless households, which spend more than three-quarters of their income on food.

Regressions show morbidity to be an important determinant of short-run nutritional status, weight for height. There appears to be little association between income and morbidity, although sugar-household children are sick more often than corn-household children, which is consistent with the more rapid deterioration in height for age for sugar-household children as they grow older.

Export cropping can significantly raise the incomes of smallholder producers. To prevent further consolidation of smallholder farms, however, the government needs first to make a conscious effort to encourage export cropping by smallholders by providing them with credit and know-how through extension and by actively promoting their access to processing and marketing facilities where necessary. Second, smallholder corn productivity needs to be improved. Both open-pollinated and hybrid varieties are available, but typically only larger landowners in Bukidnon are experimenting with the new corn technologies.

In the area of nutrition policy, providing landless households with access to land appears to be a sufficient condition for limited improvement in preschooler nutritional status. For households with access to land, however, pre-schooler nutrition does not seem to improve as income increases. Regressions show calorie intake of pre-schoolers to be positively and significantly related to their nutritional status. Yet higher-income households choose to purchase nonfood items and higher-priced calories at the margin, while pre-schoolers continue to consume well below recommended intakes. Surely education has some role to play in convincing parents to adjust food-expenditure behaviour and to distribute calories more equitably among household members. Even this, however, may not be sufficient given the high prevalence of pre-schooler sickness, even among high-income groups. Reducing illness may involve both education and improvement of community-level health and sanitary conditions.