The kernel maintains an internal cache which maps IP addresses to
hardware addresses on the local network, so that Ethernet/Token Ring/
etc. frames are sent to the proper address on the physical networking
layer. Normally, kernel uses the ARP protocol to resolve these
mappings.

Saying Y here adds support to have an user space daemon to do this
resolution instead. This is useful for implementing an alternate
address resolution protocol (e.g. NHRP on mGRE tunnels) and also for
testing purposes.

If unsure, say N.