A Micro Level Analysis of Utilization of Agricultural Saving: Causes and Prospects Dr. Singh Poonam Associate Professor, Deptt. of Economics, SRS Girls PG College, Bareilly Online published on 7 October, 2019. Abstract It has been observed by several scholars that due to the higher marginal propensity to consume at lower and middle income levels, farmers have gone to improve living and nutrition standards including better education and health care rather than ploughing back it in to agriculture sector. Even growth of income of large cultivators; spread of financial institutions in the rural areas and the deceleration of investment in physical assets have resulted in increased outflow of savings from the agriculture sector to non-agricultural sectors. This study has been explored the reason of outflow of agricultural surplus to non-agriculture sector in the state of Uttar Pradesh by a multistage stratified random sampling design with the help of a detailed structured questionnaire. Most of the farmers preferred investment in agriculture due to lack of capital to invest in other business, which needs huge investment at a time, profit from cash crops, risk and competition in other business and less risk in agriculture. Most of the farmers in state preferred investment in non-agriculture sector to earn extra income, due to lower return from smallholdings in agriculture, to fulfill the needs of family, hard work and less profit in agriculture, increasing cost of inputs and lower prices of the agricultural product. The results supported the view about the outflow of agricultural savings to non-agricultural sector, mainly in eastern region of the state. All these trends indicate that there was substantial out flow of the savings in agriculture sector to non-agricultural sector but it is not due to the neglect of agriculture. Importance of agriculture sector is still pertinent and reflected by large investment in the agriculture by the sample households, particularly by medium and large farmers. In spite of increasing cost of cultivation, hard fieldwork and decreasing returns, preference to invest in agriculture is not decreasing in farmers. Top Keywords Agricultural saving, investment, non-agriculture sector, preferences, education. Top |