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Abstract

Full-time working within agriculture is now relatively uncommon; many farm households are still active in the off-farm labor markets, in and outside the local economy. This paper examines the impact of a portfolio of off-farm incomes on food consumption patterns using Working-Leser framework, under two-stage budgeting, to isolate the off-farm income effect from the pure expenditure elasticities. This is analyzed for rural farm households in transitional Albania. The results indicate that food at home consumption has a positive and inelastic association with offfarm wage income, whereas, the response food away from home consumption is positive and highly elastic. Remittances generate the opposite effect on food consumption both at home and away from home, leading to reduction of food consumption. A disaggregated analysis reveals that off-farm wage income increases households’ consumption of cereal-based foods at home; we find the opposite and significant effect for remittances. These findings should be of interest to policymakers in Albania, especially in designing poverty and nutrition programs.

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