Income diversification strategies among rural households in developing countries

2014 ◽  
Vol 5 (1) ◽  
pp. 75-92 ◽  
Author(s):  
Bernardin Senadza
Keyword(s):  
Rural Households ◽  
Multinomial Logit ◽  
Farm Income ◽  
Income Diversification ◽  
Content Type ◽  
Access To Credit ◽  
Self Employment ◽  
Rural Income ◽  
Diversification Strategies ◽  
On Farm

Purpose – The purpose of this paper is to examine the income strategies adopted by rural households in Ghana and analyzes the determinants of households’ choice of income portfolio. Design/methodology/approach – A multinomial logit approach is employed by the paper to investigate the determinants of various income strategies adopted by households in rural Ghana. Findings – Results indicate that household characteristics, location and infrastructure all play a role in explaining the adoption of income strategies other than a purely on-farm strategy by households. Education is a key determinant of income strategies involving non-farm wage employment, while access to credit and electricity play important roles in non-farm self-employment income strategies. Practical implications – The findings of the paper call for a promotion of off-farm income opportunities to complement farm incomes and to enhance access of rural households to these sources of income. Originality/value – The paper models rural household income portfolios into mutually exclusive categories which enables the application of the multinomial logit approach. The paper deviates from mainstream rural income diversification literature that has focussed on assessing the determinants of income shares.

scholarly journals Staying or Leaving? Analyzing the Rationality of Rural-Urban Migration Associated with Farm Income of Staying Households: A Case Study from Southern Ethiopia

2015 ◽  
Vol 2015 ◽  
pp. 1-8 ◽  
Author(s):  
Beneberu Assefa Wondimagegnhu
Keyword(s):  
Rural Households ◽  
Farm Income ◽  
Southern Ethiopia ◽  
Urban Migration ◽  
Diversification Strategy ◽  
Income Diversification ◽  
Rural Urban Migration ◽  
On Farm

The research aims at analyzing the effect of rural-urban migration and remittances on farm income of rural households supported by a case study conducted in Southern Ethiopia. Using two-step estimations to measure the effect of outmigration, migrant sending families have gained higher farm income. In this regard, rural outmigration has been found to be a survival and income diversification strategy in the study area.

scholarly journals Diversification strategies and their impact on farm performance

2013 ◽  
Vol 7 (2-3) ◽  
pp. 57-61 ◽  
Author(s):  
Cristina Salvioni ◽  
Lara Fontanella
Keyword(s):  
Product Differentiation ◽  
Economic Performance ◽  
Random Effect ◽  
Value Added ◽  
Least Square ◽  
Farm Income ◽  
Income Diversification ◽  
Diversification Strategies ◽  
On Farm ◽  
The Impact

The objective of this study is to identify factors determining the economic performance of agricultural holdings in Italy, with specific attention to the impact of the adoption of on-farm diversification strategies, namely income diversification and product differentiation. The adoption of these kinds of strategies has been increasingly recognised as a viable business option in agriculture as they allow better allocation of farm resources and an increase in the quota of value added retained on farms and therefore not passed on to other agents operating at the end of the food supply chain. By using a panel of professional Italian farms over the time period of 2003-2009, we estimate random effect, ordinary least square and quantile regression models to estimate the impact of income diversification and product differentiation strategies on the levels of farm income per unit of labour income. Our findings show that scale economies are important positive determinants of farm economic performance. On the contrary, when the family play an important role in the farm business, economic performance is worse. Finally, we do not find evidence of a statistically significant impact of the adoption of income diversification and product differentiation strategies. This latter result may be interpreted as a signal that farms use these strategies as risk management tools rather than as income increasing ones.

Impact of agricultural credit on farm income under the Savanna and Transitional zones of Ghana

2019 ◽  
Vol 79 (1) ◽  
pp. 60-84 ◽  
Author(s):  
Abdul-Hanan Abdallah ◽  
Micheal Ayamga ◽  
Joseph A. Awuni
Keyword(s):  
Selection Bias ◽  
Farm Size ◽  
Farm Income ◽  
Data Set ◽  
Content Type ◽  
Credit Access ◽  
Access To Credit ◽  
Mean Differences ◽  
On Farm ◽  
The Impact

PurposeThe purpose of this paper is twofold: to determine the factors contributing to farm income in the Transitional and Savanna zones of Ghana and to ascertain variations between in the same and across the two locations; and to determine the impact of credit on farm income in each of the two zones and to ascertain the variation in impact of credit across the two locations.Design/methodology/approachIn order to address endogeneity and sample selection bias, the authors draw from the theory of impact evaluation in nonrandom experiment, employing the endogenous switching regression (ESR) while using the propensity score matching (PSM) to check for robustness of the results.FindingsThe results show significant mean differences between some characteristics of households that have access to credit and those that did not have access. Further, the results revealed farm size, labor; gender, age, literacy, wealth and group membership as the significant determinants of both credit access and income in the two zones. With the ESR, credit access increases households farm income by GH¢206.56/ha and GH¢39.74/ha in the Transitional and Savanna zones, respectively, but with the PSM, credit increases farm income by GH¢201.50 and GH¢45.69 and in the Transitional and Savanna, respectively.Research limitations/implicationsThe mean differences in characteristics of the households revealed the presence of selection bias in the distribution of household’s covariates in the two zones. The results further indicate the importance of productive resources, information and household characteristics in improved access to credit and farm income. Also, the results from both methods indicate that credit access leads to significant gains in farm income for households in both zones. However, differences exist in the results of PSM and that of the ESR results.Practical implicationsThe presence of selection bias in the samples suggests that the use of ESR and PSM techniques is appropriate. Further, the results suggesting that enhanced credit access and farm income could be attained through improved access to household resources and information. The results also suggest the need for establishing and expanding credit programs to cover more households in both zones. The differential impact of credit between the two methods employed in each zone revealed the weakness of each model. The low values from PSM could indicate the presence of selection bias resulting from unobservable factors whiles the high values from the ESR could stem from the restrictive assumption of the model. This reinforces the importance of combining mixed methods to check robustness of results and to explore the weakness of each method employed.Originality/valueThe novelty of this study lies in the use of a very extensive and unique data set to decompose the determinants of credit access and farm income and as well as the impacts of credit into zones.

THE DETERMINANTS OF LIVELIHOOD INCOME DIVERSIFICATION AMONG RURAL FARMING HOUSEHOLDS IN OSUN STATE, NIGERIA.

2021 ◽  
Vol 5 (2) ◽  
pp. 79-84
Author(s):  
M. Akinyemi ◽  
J. A. Olayinka ◽  
M. Junaidu ◽  
D. Ekpa ◽  
T. Bodaga ◽  
...  
Keyword(s):  
Regression Analysis ◽  
Rural Economy ◽  
Descriptive Statistics ◽  
Farm Households ◽  
Farm Size ◽  
Farm Income ◽  
Agricultural Practice ◽  
African Countries ◽  
Income Diversification ◽  
Access To Credit

Rural economy in Nigeria is worst hit with the erratic and unpredictable factors that affect agricultural practice which is the main livelihood of the rural farm households. Consequently, farmers are left with the option of sourcing other means of survival to cope with the hard times due to in consistent and seasonal distribution of income which characterize small farm holders in sub-Saharan African countries. This study investigates the factor influencing the livelihood income diversification among rural farm households in Osun state, Nigeria. Multi stage sampling techniques was employed to sample120 structured and pre-tested questionnaires from 120 rural farm households. Descriptive statistics and multiple regression analysis were used to analyze the data. The results of the descriptive statistics revealed that household heads of age range 50-60 years are 38.6% and about 40.70% had primary education while 26.30% had no education. About 98.31% of the rural households engaged in farming out of which 80.57% have farm size ranging between 1-3 hacters. Logit regression analysis shows that access to credit was positively significant (P<0.05) which implies that farmers that have access to credit were more likelihood to have income diversification. Age of the farmers was negatively significant (P<0.1). It connotes that the older the farmers the lesser the likelihood to income diversification. Income equivalent of household was positively significant (P<0.1). Access to electricity was positively significant (P<0.05). This implies that access to electricity increase farmer’s likelihood to income diversification. The off-farm income analysis shows that education and farm size were respectively negative and

Effect of off-farm income on multi-dimensional poverty among rural farm households in Nigeria

2019 ◽  
Vol 46 (9) ◽  
pp. 1081-1094 ◽  
Author(s):  
Ifeoluwa Damilola Adeoye ◽  
Wayo Seini ◽  
Daniel Sarpong ◽  
Ditchfield Amegashie
Keyword(s):  
National Level ◽  
Living Standards ◽  
Farm Households ◽  
Living Standard ◽  
Farm Income ◽  
Future Research ◽  
Policy Makers ◽  
Content Type ◽  
Self Employment ◽  
Geographical Regions

Purpose The purpose of this paper is to analyze the effect of the different components of off-farm income on multi-dimensional poverty. Furthermore, the study aims to measure multi-dimensional poverty and also identify the determinants of multi-dimensional poverty in Nigeria. The paper reveals the different contributions of the dimensions of education, health and living standard. Design/methodology/approach The study focuses on rural farm households in Nigeria. Data are obtained from the Nigeria General Household Survey, 2013. The survey covers both urban and rural areas of the 36 states of Nigeria. Owing to the interest of this study in the rural farm household’s sub-sector, a nationally representative sample of 836 rural farm households are selected for the study after the data merging process. Rural farm households in this paper earn 50 percent of their total income from crop and livestock production. The paper employs the Multi-dimensional Poverty Index (MPI) to measure multi-dimensional poverty across the six different geographical zones of Nigeria. The probit regression model is used to estimate and analyze the effect of off-farm income components on multi-dimensional poverty and also to identify the determinants of multi-dimensional poverty. Findings The results of the study show that among the off-farm income components, the non-farm wage income and non-farm self-employment income have negative association with multi-dimensional poverty. Findings show that multi-dimensional poverty is high in Nigeria with deprivations in health contributing the most. Northern Regions have a higher estimate. Results reveal that sex, age, number of adults, formal credit access, access to extension services and location characteristics are key determinants of multi-dimensional poverty. The MPI for Nigeria averaged 47 percent. Across regions, deprivation in the health dimension contributes about 44 percent to multi-dimensional poverty. Deprivation in living standards contributes 40.5 percent, while deprivation in education contributes 15.5 percent to multi-dimensional poverty. Research limitations/implications Due to the nature of the data used, the health indicators (nutrition and child mortality) are absent but proxies are used instead. Future research could introduce gender dimensions. Practical implications Improving the involvement of rural farm households in non-farm self-employment sector could improve their livelihoods and prevent migration to urban centers, especially among the youths. Social implications Improving the quality of health, education and living standards will lead to lower poverty levels in Nigeria. Farmers can best reduce their multi-dimensional poverty by engaging in more off-farm jobs. Originality/value This paper provides information to policy makers on the effect of different components of income from the off-farm sector on multi-dimensional poverty alongside with the determinants of multi-dimensional poverty at a national level for the rural farm households. By using MPI, the contribution of the different dimensions used in computing the MPI across the six geographical regions within the country is revealed. This provides policy makers with more information for development purposes.

scholarly journals The Effect of the Comprehensive Rural Village Development Program on Farm Income in South Korea

2020 ◽  
Vol 12 (17) ◽  
pp. 6877
Author(s):  
Eunji Choi ◽  
Jonghoon Park ◽  
Seongwoo Lee
Keyword(s):  
Rural Development ◽  
South Korea ◽  
Positive Impact ◽  
Rural Households ◽  
Development Program ◽  
Farm Income ◽  
Rural Village ◽  
Ex Post ◽  
On Farm ◽  
The Impact

Faced with an aging and declining population, many governments around the world endeavor to revitalize their rural communities in a sustainable manner. In South Korea, the Comprehensive Rural Village Development Program (CRVDP) was carried out from 2004 to 2013 as a key strategy to reinvigorate rural areas. This study aims to conduct an ex-post quantitative evaluation of the effectiveness of the CRVDP in boosting rural households’ farm income. In doing so, the present study adopts quasi-experimental research design that is seldom utilized in assessing rural policies. As an alternative evaluation tool with flexibility for using readily available data, the study employed the combined application of the Heckman selection model and the Blinder–Oaxaca decomposition method. The study revealed a significant positive impact of the Program on farm income of rural households in the program-supported areas from both cross-sectional and longitudinal perspectives. A robust causal estimation of the impact of this bottom-up, multi-sectoral rural development program on farm income is achieved, which can be leveraged to widely promote similar type of rural development approach.

scholarly journals Income Diversification and Sustainable Land Management Practices among Rural Cassava-based Farmers in Imo State

2019 ◽  
pp. 1-14
Author(s):  
I. H. Eririogu ◽  
E. D. Mevayekuku ◽  
R. N. Echebiri ◽  
A. Atama ◽  
P. C. Amanze ◽  
...  
Keyword(s):  
Land Management ◽  
Management Practices ◽  
Diversity Index ◽  
Primary Data ◽  
Farm Income ◽  
Sustainable Land Management ◽  
Income Diversification ◽  
Imo State ◽  
Cassava Production ◽  
On Farm

Aims: To examine the income diversification activities and sustainable land management practices among rural cassava-based farmers in Imo State, Nigeria. Study Design: Primary data collection. Place and Duration of Study: Michael Okpara University of Agriculture, Umudike, Pre-requisite study, Post-Graduation in Agricultural Resource and Environmental Economics, between August 2017 and January 2018. Methodology: Data were collected using well-structured questionnaire, administered to rural cassava-based farmers. Multi-stage and purposive sampling techniques were employed, and one hundred and twenty (120) farmers were randomly selected for the study. Data collected were analyzed using descriptive statistics, Sustainable Land Management Index, Probit model and Inverse Herfindahl–Hirschman Diversity Index. The sustainable land management index (SLMI) was constructed from twelve (12) different sustainable land management indicators based on the sustainable practices prevalent in the study area. Results: Results showed that cassava-based production was dominated by female farmers (63.33%) with mean age of 46, married (70.00%) with mean household size of 6 persons. The Inverse Herfindahl-Hirschman Diversity (IHHD) results showed that 87.50% of rural cassava-based farmers diversified their income base into other income-generating activities namely, off-farm and/or non-farm activities. The mean naira value for on-farm income was N 130,646.2k, while that of off-farm and non-farm were N 20,554.17k and N 78,333.33k, respectively. Cassava-based farmers diversified mostly into non-farm activities together with their on-farm activities, with a mean annual income (in naira) of N244,333.60k. The probit analysis showed that off-farm and non-farm activities have positive and significant effects on sustainable land management practices. The off-farm and non-farm activities encouraged the rural cassava-based farmers to adapt sustainable land management practices. However, doubling farmer’s engagement to off-farm activities (off-farm2) had a negative effect on sustainable land management, indicating that doubling their engagement to off-farm activities empowers farmers to adapt unsustainable labour-saving practices such over use of agrochemicals (herbicides, inorganic fertilizers and insecticides), due to drudgery and exhaustion as they allocate more of their labour services to another farmer’s farm. Conclusion: In order to improve the adoption and adaption of sustainable land management practices, and reduce the drudgery in cassava production as farmers diversify more into off-farm activities, sustainable labour-saving technologies and practices such as conservation tillage and simple tools that reduce labour requirement in cassava production, save time and energy, were recommended. More lands should be allocated to cassava farmers, as farm land diversity will facilitate the adoption and adaption of sustainable land management practices such as fallowing and crop rotation that increase productivity by replacing fallow periods with growing different crops that replenish soil nutrients.

scholarly journals The Effects of Non-Farm Enterprises on Farm Households’ Income and Consumption Expenditure in Rural India

2019 ◽  
Vol 19 (1) ◽  
pp. 195
Author(s):  
. Zeeshan ◽  
Geetilaxmi Mohapatra ◽  
Arun Kumar Giri
Keyword(s):  
Propensity Score ◽  
Farm Households ◽  
Rural India ◽  
Farm Income ◽  
Consumption Expenditure ◽  
Income Diversification ◽  
Probit Models ◽  
Structural Differences ◽  
Nationally Representative ◽  
On Farm

Nationally representative data of farm households from India Human Development Surveys (IHDS) conducted in 2004-05 and 2011-12 are explored. This article analyzes the effects of income diversification in non-farm enterprises on farm households’ income and consumption expenditure in rural India. Panel probit models were built to examine the determinants of income diversification while propensity score matching was used to account selection bias resulting from unobserved factors and controls for structural differences between diversified and undiversified farm households. The results suggest that by engaging in non-farm enterprises, rural farm households make positive gains in farm income and consumption expenditure.

The ripple effect of credit accessibility on the technical efficiency of maize farmers in Ghana

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Anthony Siaw ◽  
Yuansheng Jiang ◽  
Martinson Ankrah Twumasi ◽  
Wonder Agbenyo ◽  
Gideon Ntim-Amo ◽  
...  
Keyword(s):  
Technical Efficiency ◽  
Farm Size ◽  
Farm Income ◽  
Agricultural Credit ◽  
Maize Production ◽  
Content Type ◽  
Frontier Analysis ◽  
Access To Credit ◽  
Variable Approach ◽  
The Impact

PurposeThe purpose of this study is to examine the impact of access to credit on technical efficiency (TE) of maize farmers in a developing country, Ghana.Design/methodology/approachThe study employed an instrumental variable approach and the stochastic frontier analysis (SFA) method for the estimation of the results.FindingsThe study found that farmers who have access to agricultural credit stand the chance of increasing TE by a margin of 8%, which also influences the maize production than those who did not have access to credit. The average TE score of the farmers was 74%. The study also found out that factors like membership, gender, farmers' access to credit, age and social network determine farmers' possibility of accessing agricultural credit. The study finds out that returns to size are increasing among the maize farmers and that significant improvement in efficiency can be realized by increasing the level of input used in production. Also, factors such as farm size, labor, seeds and fertilizer are the essential determinants of maize production output. Also, gender, extension, age, off-farm income, access to credit and membership were significant factors influencing technical inefficiency (TI).Originality/valueThe paper contributes to the existing literature on agricultural credit on rural agricultural development. The problem of endogeneity associated with access to credit, which has been considered by other researchers, is dealt with this study. This paper also provides information to government policymakers, practitioners and all other stakeholders in the maize sub-sectors and also will benefit small farmers outside the study area.

THE DETERMINANTS OF LIVELIHOOD INCOME DIVERSIFICATION AMONG RURAL FARMING HOUSEHOLDS IN OSUN STATE, NIGERIA

2021 ◽  
Vol 5 (2) ◽  
pp. 171-176
Author(s):  
M. Akinyemi ◽  
J. A. Olayinka ◽  
M. Junaidu ◽  
D. Ekpa ◽  
T. Bodaga ◽  
...  
Keyword(s):  
Regression Analysis ◽  
Rural Economy ◽  
Descriptive Statistics ◽  
Farm Households ◽  
Farm Size ◽  
Farm Income ◽  
Agricultural Practice ◽  
African Countries ◽  
Income Diversification ◽  
Access To Credit

Rural economy in Nigeria is worst hit with the erratic and unpredictable factors that affect agricultural practice which is the main livelihood of the rural farm households. Consequently, farmers are left with the option of sourcing other means of survival to cope with the hard times due to inconsistent and seasonal distribution of income which characterize small farm holders in sub-Saharan African countries. This study investigates the factor influencing the livelihood income diversification among rural farm households in Osun state, Nigeria. Multi stage sampling techniques was employed to sample 120 structured and pre-tested questionnaires from 120 rural farm households. Descriptive statistics and multiple regression analysis were used to analyze the data. The results of the descriptive statistics revealed that household heads of age range 50-60 years are 38.6% and about 40.70% had primary education while 26.30% had no education. About 98.31% of the rural households engaged in farming out of which 80.57% have farm size ranging between 1-3hacters. Logit regression analysis shows that access to credit was positively significant (P<0.05) which implies that farmers that have access to credit were more likelihood to have income diversification. Age of the farmers was negatively significant (P<0.1). It connotes that the older the farmers the lesser the likelihood to income diversification. Income equivalent of household was positively significant (P<0.1). Access to electricity was positively significant (P<0.05). This implies that access to electricity increase farmer’s likelihood to income diversification. The off-farm income analysis shows that education and farm size were respectively negative and

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