Non-Farm Activities and Production Decisions of Farmers: The Cases of Damotgale and Kachabira Weredas in Southern Region of Ethiopia
Tegegne Gebre Egziabher
Abstract: The study examines the influences of non-farm activities on the production decisions of farmers and the determinants of non-farm activity in Damotgale and Kachabira weredas of the Southern Region of Ethiopia. The study uses individual data from a household survey to provide background information and investigate six testable hypotheses. The analysis is carried out by separately estimating regression models for various production decisions and undertaking target variable comparison among different non-farm income groups. The study findings show that the farm sector in the study sites is characterised by shortages of land, low yield of crops, shortages of draught animals and lack of grazing land. The group comparison of the household members shows that there are significant differences in different production decisions among the different non-farm income groups. The implication of the study for agricultural and rural development is that as the non-farm sector strongly contributes to the improvement of the farm sector, rural policies should aim at promoting the farm and non-farm linkages by strengthening non-farm activities in rural areas. Education can be used as one of the effective instruments in promoting non-farm activities in rural areas.