Econometrics

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Browsing Econometrics by Author "Asmare, Workineh"

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    Analysis of Off-farm Engagements and Implications for Economic Transformation: Empirical Evidence from Libo Kemkem Woreda
    (Addis Ababa University, 2013-06) Asmare, Workineh; Admassi, Assefa( PhD)
    Off-farm engagements and earnings from such employment opportunities have become increasingly important in rural Ethiopia as the nation is striving to end poverty through a steadily growing rural income. There is an expressed policy effort to materialize a more stable and growing farm income. However, there is a paucity of policy attention to the off-farm economy notwithstanding its huge potential in diversifying rural income, reducing unemployment and transforming the rural economy. This study analyses offfarm engagements by farm households to drive important implications for policy as farm households’ behavioural choice matters for the desired/undergoing economic transformation. Specifically, we estimate farm households’ propensity to and the intensity of off-farm engagements using binary choice and censored regression models, respectively. We use a survey data of 200 farm households in Libo Kemkem Woreda, Amhara Region. Farm households’ socio-political capital, risk behaviour, financial conditions, characteristics of their farm and local labour market conditions are found to be significant predictors of the choice to off-farm engagements. On the other hand, wagerelated household characteristics and human capital variables appeared less important in explaining farm households’ choice to diversify into the off-farm economy. Likewise, a significant relationship is found between the intensity of off-farm engagements (off-farm days and earnings) and the indicators of socio-political capital, farm characteristics, risk behaviour, financial conditions and labour market conditions. The results imply that offfarm engagements have become permanent pursuits to efficiently husband farm and offfarm income sources of farm households. Thus, the study calls forth a considerable policy attention to the off-farm economy and more robust institutional arrangements to enable farm households exercise informed choices for the desired/undergoing economic transformation in the rural economy to flourish and sustain.