The Role of Informal Sector in Food Security: The Case of Addis Ababa

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Addis Ababa University


Over the past decades, informal sector has been growing fa st in Ethiopia. The maj or reason cited for this is the growing rate of rural -urban mi gration and in ab ility of the formal employment sector to prov ide joh for the active labor force. Because capac ity of formal employment scctor is very limited . those llligrants and urban poor dwell ers are urged to join informal sector. Thus, this master th es is deals with the contribution of informal sector towards enhancing food security status and vu lnerabil ity level of households in the city of Addi s Ababa. The study cmploys both primary and secondary data col lection tec hniques to gath cr thc des ired facts and info rmati on. The primary data was selected usin g questionn ai re in wh ich arou nd 222 respondents were part icipated . For sampling purpose the researcher divided Addis Ababa in to four groups us ing the city map. From these fo ur groups one sub-city was se lected purpos ive ly by considering time alld money constraints. The selected sub-cities are Bole, Arada, Nefas Silk Lafto and Ak aki Kaliti sub-c ity. In turn . seco ndary data was collected from diff'erent journals, books, resea rches, magazine and other published and unpubli shed materials from library and internet searc hing. In order to analyze the coll ec ted data both desc ri pti ve and econollletrics data anal ys is techniques were appli ed. The descripti ve analysis was used to exam ine the characteri stics of in formal sector operators. their demographic charac teri sti cs. sources of capital. income statu s, participation, planning, saving habit, food securi ty status and vuln erabi li ty level or respondents. Further, income inequality is anal yzed by using Lorenz curve and ANOVA. In addition, to analyze determin ants of food security and vulnerab ility status or the informal sec tor opera to rs, pro bit and ordered probit reg ress ion lllodeis were eillployed.The find ings of the sludy show an important contribut ion of in fo rmal sec tor employment towards enhancing food access ibili ty of the poor. Around 67.3% percent get adequate income to cover their dai ly food expenses. On the other hand, aimosl 62 .7 % of the respondents claim that they cannot survive anv further without their busin ess. They are more vulnerabl e. The major determin ants that alTcct both food security and vulnerability status of in formal sec tor operators are age, sex, household size, experience in the business, worki ng time per day, saving, total earni ngs, borrowing and I i vel i hood strategies . . The researcher advocates that the government should give suf ficient attenl ion to this neglcc ted but promi nent sector in the country's economy. This could be done through improving the capaci ty of poor inlormal sec tor operators and facil i tating credit sources with low collateral alld bureaucratic procedures. Key words: Informal sec to I', Food security, Urban poor dwellers, Addis Ababa



Informal sec tor, Food security, Urban poor dwellers