6.1 Albania: Imputation of Farm Income

372 | Revisiting Targeting in Social Assistance

Table 6.1 Albania: Imputation of Farm Income

Presumptive income rules based on land ownership—land categories and revenue coefficients, Albania

Livestock unit conversions and revenue categories

Land categories

Item I II III IV V VI VII VIII IX–X Revenue coefficient lek/m2 per year 9 8 7 7 5 5 4 4 3

Zone Coefficient

Lowlands

Hills

Mountains

Revenues from 1 cow = 15 sheep or goats = 3 swine = 5 piglets = 20 beehives = lek 22,500/year

Revenues from 1 cow = 12 sheep or goats = 3 swine = 5 piglets = 20 beehives = lek 18,000/year

Revenues from 1 cow = 10 sheep or goats = 3 swine = 5 piglets = 20 beehives = lek 13,000/year

Source: Council of Ministers, Albania 2005. Note: US$1 = lek$102.93 in 2005.

A more complex imputation method, yet still simple enough, relies on more detailed and precise information on returns to land and livestock, using agricultural registries. In Romania, from 2014 onward, researchers refined their estimation of income from agriculture, which was previously estimated using simple productivity coefficients as in Albania, based on the survey of small farm holdings harmonized across all EU countries. The survey allowed yearly estimation of gross annual margins for different types of harvests or livestock. These coefficients (table 6.2), which are representative of the earning potential of the small farms (typically informal sector farms), were then applied to the land owned (or leased) by each farmer and its stock of livestock (available in the agricultural land registry) to generate the estimated agricultural income for each household in the program. The program procedures allow the adjustment of these numbers in case of unexpected events. If the farmer experiences a shock and the agricultural production is lost in whole or in part, an agricultural extension worker certifies the loss of income and the presumptive income is excluded from the calculation of the total income of the assistance unit. This method allows a more precise estimate of farm income, based on the ownership of key agricultural assets such as land and livestock, at more frequent intervals.

Another example of simple income imputation is for unskilled seasonal work or day jobs, or for informal workers in key occupations/sectors. For example, in addition to the hard-to-verify income from land and livestock, for beneficiaries capable of working, Albania, Romania, and Uzbekistan also impute presumed earnings from seasonal occasional work—at local market wage rates—for a given number of days per month during the