Small Holder Farmers’ Participation in Non-Farm Activities: Evidence from Humbo District, Southern Ethiopia

Abstract

Poverty in rural areas of Ethiopia has its root, in low productivity, landlessness and erratic weather dominant areas. Small and fragmented farm size coupled with low level of technology, soil degradation and poor infrastructure, have reduced the capacity of small holder farmers to undertake long term investment on the farm. Therefore, non-farm activities provide employment opportunity in their own and also supplement agricultural incomes. This study was conducted with the objective of identifying and analyzing the factors that influence participation of farmers in non-farm activities in Humbo district. In order to achieve this objective, primary data were collected from 145 randomly selected households by using semi-structured interview. For the data analysis, descriptive statistics including mean, frequency and percentages were used to describe the farm and non-farm characteristics of the households. Moreover, t-test and chi-square analyses were employed to compare the non-farm participant and non-participant group. A Bivariate probit model was used to analyze the factors that influence participation in non-farm activities. A total of 11 explanatory variables in five groups (asset, household characteristics, individual characteristics, location and price proxy) were considered in the regression. Out of these, total land size and TLU, Age, sex and education level, family size, agro-ecology and distance from nearest market were found significantly affecting participation. Therefore, development strategies should not only emphasis in increasing agricultural production but concomitant attention should be given in promoting participation in non-farm activities in the rural areas.

Keywords: non-farm activities, small holders, participation