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Assessing inequality effects of forest income and implications to rural household in the Province of Cagayan

Florante Victor M. Balatico

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J. Bio. Env. Sci.13(4), 161-180, October 2018


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This study attempted to analyze the effect of forest income of rural households in the Cagayan Province, Philippines. The sample for analysis consists of 691 household-respondents. FGT was estimated in order to examine the income inequality and the poverty situation among the forest-dependent households with and without forest income. To analyze the factors related to the households’ forest dependence, an ordinary least squares regression analysis was conducted. In this study, forest dependence was expressed as the relative share of forest income to the total household income. On the average, poverty headcount or the number of households below the threshold level was greater if forest income was not accounted for. The significant factors that determine forest dependence are years of schooling of the household head, distance of the household from the clinic, size of the land owned by the household, machine value, distance of the household from the market, and distance of the household from the forest. All these factors have negative effect on forest dependence. Forest dependence has unequalizing effect to household income. It has become a source of income inequality among the rural households. However, this is not to say that forest dependent households must refrain from being forest dependent. Moreover, most of the non-forest income sources of the households are activities related to agriculture. This dependence makes the households vulnerable to natural shocks. It is therefore recommended that households should diversify its livelihood strategy such that not all of its activities are farm-based and forest-based. Rendering of skilled job, which may necessarily prompt a household member to migrate, can be an option. Moving away from the farm to work in the formal sector may be a reliable and more stable source of income.


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