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 Agris on-line Papers in Economics and Informatics
Volume X Number 2, 2018

Rural Households Livelihood Strategies and its Impact on Livelihood

Outcomes: The Case of Eastern Oromia, Ethiopia
Beyan Ahmed Yuya1, Nano Alemu Daba2

1
School of Agricultural Economics and Agribusiness, Haramaya University, Dire Dawa, Ethiopia
2
School of Plant Sciences, Haramaya University, Dire Dawa, Ethiopia

Abstract
This study analyzed the factors affecting smallholder farmers decisions to adopt livelihood strategy choices
and its impact on rural households’ livelihood outcomes in the Meta district, Eastern Ethiopia during
the 2016/17 production year. The data used for the study were obtained from 180 randomly selected sample
households. Multinomial logit model was employed to analyze the determinants of farmers’ decisions
to adopt livelihood strategies. The average effect of adoption on households’ farm incomes was estimated
by using propensity score matching method. The result of the multinomial logistic regression showed that
age of the household head, distance from irrigation sources, social status, soil fertility status, education
level, distance from Developmental Agents (DAs) office, economical active members, soil fertility status,
soil conservation and transportation services were significantly affects households’ adoption decision. Impact
evaluation results showed that about 12.9, 45.2 and 41.9 percents of the sample households who using crop
farming only, crop + livestock farming, and crop + livestock + off/non-farming strategies were non poor,
respectively. Similarly, about 9.4, 30 and 19.4 percents of the sample households who using crop farming
only, crop + livestock farming and crop + livestock + off/non-farming strategies were food secured, in that
order. The estimation results provides a supportive evidence of statistically significant effect of livelihood
strategies on rural households livelihood outcomes measured by food security status and poverty status.
Therefore, policy makers should give due emphasis to the aforementioned variables to reduce households
level food insecurity status and improve the livelihood of rural households.

Keywords
Households, livelihood strategies, outcomes and multinomial logit model.

Yuya, B. A. and Daba, N. A. (2018) “Rural Households Livelihood Strategies and its Impact on Livelihood
Outcomes: The Case of Eastern Oromia, Ethiopia", AGRIS on-line Papers in Economics and Informatics,
Vol. 10, No. 2, pp. 93-103. ISSN 1804-1930. DOI 10.7160/aol.2018.100209.

Introduction Rising the agricultural production at the national

level leads to improve overall economic growth
Ethiopia is one of the Sub-Saharan African and development. However, currently climate
countries which liberalize its economy to maintain change has become a serious threat to sustainable
in all sectors to sustained economic growth economic growth (Gebreegziabher et al., 2012).
and reduce poverty. However, five years later this Disturbance like drought, eviction, climate change
was declining to 29.6%. Moreover, poverty head will affect livelihoods and will push households
count is still more prevalent in rural (30.4 percent) to both farm and nonfarm activities (Baird et al.,
than urban areas (25.7 percent) in Ethiopia (CSA, 2009; Chilongo, 2014). Baird et al. (2013) study
2015). In Ethiopia, about 83.9 % of total population revealed that eviction plays a role in shaping
are live in rural area and agriculture is main source diversification strategies in the developing world.
of their livelihood. Since 2010, agriculture becomes
the second most dominant next to service sector As depicted by FAO (2012), despite agricultural
of the country’s economy by providing employment contribution to the livelihood of the society,
for 80 % of the total labors force and contributes the increasing population growth in developing
42.7 % to Gross Domestic Product and 70 percent countries, including Ethiopia forced households
of foreign exchange earnings (NBE, 2013; CSA, to cultivate and make their living on the small
2013). size of land. Due to the decline in land holding

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

per individuals as well as fragmentation of their class clustering technique in livelihood strategy
holding and low income obtained from farming identification, which involves a less arbitrary cluster
activity, the majority of rural households are exposed selection technique based on parameter estimation
to food insecurity and chronic poverty. In addition, and model testing. The overall objective of this
due to periodic drought and extremely variable article is to contribute to the understanding
environment, making farming risky economic of empirical regularities of important sources
activity farmers face fluctuation in their income. of income among rural livelihood strategies
As for Amsalu et al. (2014) finding, rural households in developing countries and the factors associated
diversify their activities into off-farm and nonfarm with choice of strategies.
activities to off-set the diverse forms of risks
Therefore, enhancement of agricultural productivity
and uncertainties associated with agriculture; create
is thus an important condition for alleviating rural
a way of smoothing their income over the years
poverty, and due to it increases household income
and seasons; and reduce their vulnerability
and stimulating the growth of non-farm activities
to different kinds of shocks, seasonality and trends.
among rural households. It is widely argued that,
The severity of rural livelihood and poverty achieving agricultural productivity growth will not
in developing countries like Ethiopia has necessarily be possible without developing and disseminating
informed a drift in her agricultural systems improved agricultural technologies that can
from the strengthening of national research increase productivity to smallholder agriculture
systems towards systems that enable innovations farm (Asfaw et al., 2012). Like in many other
from individuals and communities, proper Sub-Saharan African countries, agriculture is
transfer and utilization of knowledge and overall the most important sector for economic
transformation. Agricultural productivity remained growth and for the enhancement of household
low as a result not only lack of appropriate income in Ethiopia. However, lack of adequate
technologies and lack of access to those farm management practices and low level of
technologies, inputs, credit and access to markets inputs applied, the highly rain fed dependent
and rural infrastructure, but also because of gaps agriculture system are major challenges to sustain
in information and skills that prevented rural the agricultural production in Ethiopia (Pender
producers from effectively utilizing and adopting and Gebremedhin, 2007; Kassie et al., 2009).
technologies (Sanginga et al., 2009). Therefore, Despite the fact that, the agriculture sector is
the role of agricultural productivity in poverty mostly susceptible in seasonal rain fall, the rural
reduction, improving livelihood and enhancing households are generating their family income from
productivity outcomes cannot be over emphasized. difference sources to averse the risk associated
Agricultural productivity and improved livelihood in agricultural farm sector. As a result the main
remained low as a result not only of the lack source of income in most rural household
of appropriate technologies and the lack of access of Ethiopia is derived from farm and non-farm
to those technologies, inputs, credit and access activities.
to markets and rural infrastructure, but also because
Agriculture is the primary source of rural income
of gaps in information and skills that prevented rural
as 80% percent of the rural labor force is engaged
producers from effectively utilizing and adopting
in this sector (CSA, 2013). Non-farm income
technologies (Miriam et al., 2011).
of the rural household referred to an income that
Livelihoods strategies cannot be identified the rural households generate from none of crop
by a single activity variable only, as the diverse mix or livestock production during a one year
of assets available to individual households typically of agriculture production period. Non-agricultural
produce a wide range of different asset allocation activities are not getting prevalence in rural
choices (Barrett et al., 2001). For example, two Ethiopia because households are rarely practicing
households endowed with equal areas of land dominated by a subsistence agriculture sector.
might choose to use that land differently depending As a result of this, the income from nonfarm activity
on other factors such as human and financial is also very low. This subsistence agriculture
capital at their disposition. Hence, livelihood and low level of rural household income is socially
strategy identification requires clustering a vector and economically could make unstable the rural
of activity variables (e.g., Brown et al., 2006; society. Therefore, it is significantly important
vanden Berg, 2009), which requires starting with to identify the factors that affect agricultural
pre-determining a more-or-less arbitrary number of productivity and find the methods of the rural
cluster centers. Therefore, this study uses the latent household income improvements.

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

Rural households in the study area engage use pattern of Meta district consists 48% arable
in diverse livelihood strategies away from purely and 13% pasture and forest, and the rest 39%
crop and livestock production towards nonfarm regarded as degraded (CSA, 2013). Sorghum,
and off-farm activities which are undertaken maize, barley and wheat are the major food
to generate additional income for survival and cope crops in the district, whereas khat and coffee
with harsh conditions. But, there was no empirical are the major cash crops. The farming system
data that substantiate or supports the existing of the administration consists of crop
livelihood strategies practiced by the farmers in the production (4.1%), livestock production (7.9%)
study area. To intervene the problem, there needs and householders that are engaged in mixed crop
to untie the interwoven factors which can motivate and livestock production (88.0%).
rural households to diversify their livelihood
2. Sources of data and methods of data collection
strategies and improve their participation
in different off -farm and /or non-farm activities As sources of information both primary
have got paramount importance to development and secondary data sources were used. The primary
practitioners and policy makers to find the way data were collected by the trained enumerators.
out (Gebrehiwot and Fekadu, 2012). Therefore, In addition to primary data, secondary data
a thorough understanding of factors determining were also collected from relevant sources such
choice of livelihood strategies is important as published and unpublished documents
to improve the response mechanisms related to from the relevant institutions for general description
poverty, food security and livelihood improvement. and to augment primary data.
Hence, this study aimed at investigating
3. Sample size and sampling technique
the livelihood strategies practiced by rural
households and its impact on livelihood outcomes. Meta district was selected purposively due its
This study was focused on rural households’ potential area for cereal crops and problems
livelihood strategies and its impact on households’ of rural households livelihoods. From this district
livelihood outcomes at the farm household level two peasant associations were selected purposively
in eastern Ethiopia at large and in Meta district because of their accessibility. Then the sample
of eastern Hararghe zone in particular. from each peasant association selected randomly
The objective of the study was, therefore, based on probability proportion to size. Finally, a total
to identify the determinants of rural households’ of 180 sample respondents were interviewed.
choice of livelihood strategies and its contribution 4. Methods of data analysis
in improving rural livelihood outcomes in Meta
of Oromia, eastern Ethiopia. To address the objective of the study, both
preliminary statistics and econometric methods
Materials and methods were employed. Mean comparison was employed
for impact evaluation and Multinomial logit was
1. Description of the study area used to identify determinants of smallholder
farmers decision to choice livelihood strategies
The study was conducted in Meta district among
19 districts of eastern Hararghe zone of Oromia 5. Food security measure
regional state. Based on statistical figures published Food security pillars: Access, availability,
by the Central Statistical Agency (CSA) in 2015, utilization and stability are frequently cited
this district has an estimated total population in the literatures as organizing principles
of 240,285 of whom 117,864 are men for food security measurement (Jones et al., 2013;
and 122,421are women; 12,459 or 5.19% of its Carletto et al., 2013; Coates, 2013). However,
population are urban dwellers, which is less than many authors note that the “pillars” analogy can
the Zonal average of 6.9%. Meta has an estimated hamstring improved food security measurement
population density of 365.7 people per square efforts because each one has not been well-
kilometer, which is greater than the Zone average defined (Berry, 2015; Coates, 2013; Moltedo
of 102.6. In general, the district is designated as et al., 2014). Household surveys yield information
famine prone and frequent crop failure is a common about household expenditure decisions and take
problem usually leading to food shortage. Drought the actual demographic structure of the household
induced food insecurity has been a common into account (de Haen, 2011). They are also costly
recurrent phenomena exacerbating the vulnerability to implement and tend to be infrequently
of resource poor farm households in the area administered (Jones et al., 2013; de Haen, 2011).
to be food insecure (MARDO, 2013). The land

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

Perhaps recent research suggests household Where α takes a value of zero for the headcount
food consumption expenditure results can vary index, one for the poverty gap index and two
significantly based on survey design, with some for the squared poverty gap index
authors arguing this should be only be used
7. Determinants of the choice of livelihood
with great caution until more consistent
strategies
and comparable survey data collection can be
completed (de Weerdt et al., 2015; Carletto Multinomial Logit (MNL)
et al., 2013). Therefore, in this study household
The MNL model was used by many researchers
food expenditure was used. In this measure
to the model determinants of households’ choices
the frequency of dietary food consumption
of livelihood strategies in the context of multiple
of different food groups consumed by a household
choices (Deressa et al., 2019, Nhemachena
during the last 7 days before the survey was
and Hassan, 2008). To describe the multinomial
calculated and consumption score is then calculated
logit model, let Yi denoted vector of options
using weights assigned to each food group using
for strategies to chosen by farmer household. This
the cut-off point of 2200 kilocalories as
model for a livelihood choice specifies the following
the minimum caloric requirement, used by official
relationship between the probability of choosing
reports in Ethiopia (MOFED, 2010).
option and the set of explanatory variables Xi
6. Construction of poverty indexes as (Greene, 2003)
Based on poverty line, three poverty measures
that were identified by Foster et al. (1984) (5)
were employed. The headcount index indicates
the proportion of population regarded as poor. Equation (6) was normalized to remove
The headcount index was estimated as: indeterminacy in the model by assuming β0 = 0 and
(1) the probabilities were estimated as:

Where, P = the number of poor people;

n = population size.
j = 0,1,2....j, β0 = 0 (6)
On the other hand, poverty gap index was calculated
as following. to determine the poor below Where, j stands for livelihood strategies, x stands
the poverty line on average. If Z is a poverty line, Yi for explanatory variables and β" stands
is the per capita income of i, then the poverty gap is for parameters to be estimated. The estimated
parameter of the MNL model provide only
the direction of the effect of the explanatory
(2)
variables on the dependent variable (livelihood
strategies), but do not represent either the actual
Where, Z = poverty line; Yi = the per capita of i. magnitude of change or probabilities. To interpret
In the equation, z - yi = 0 if yi > z. the effects of explanatory variables
on the probabilities, marginal effects are usually
Squared poverty gap measures the severity derived as indicated by Greene (2003). Maximum
of poverty giving more weight to the poor and was likelihood estimation of equation (8) yielded
depicted as follows. the log-odds ratio. The dependent variables of
any adaptation option is therefore the log of odd
in relation to the base alternative.

if k = 0 (7)
(3)
All the above three measures, which depend According to Greene (2003), the MNL coefficients
on parameter, is given below. are difficult to interpret and associating
with the jth outcome is tempting and misleading.
Marginal effect is useful to interpret the effect
(4) of independent variable on the dependent variable
in terms of probabilities.

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

Sex Freq. Percent

(8)
Female 18 10.00
Male 162 90.00
Results and discussion Total 180 100.00
Soil conservation Freq. Percent
1. Descriptive statistical results for continuous not 56 31.11
variables
conserved 124 68.89
The results of the study showed that, the mean Total 180 100
age of household age was 36 years and the mean Farmer training Freq. Percent
household size and economical active members
Otherwise 63 35.00
were 5 and 2.98 in person and men equivalent,
Participated 117 65.00
respectively (Table 1). Similarly, the mean
cultivated land and livestock holding were 0.397 Total 180 100
and 3.55 in hectare and tropical livestock unit, Transportation Freq. Percent
in that order. Likewise, the descriptive result human labor 40 22.22
indicated that the total crop output and livestock pack animals 116 64.44
income were 1474.23 and 4399.27 in quintals Vehicles 24 13.33
and birr, respectively. The results of infrastructural Total 180 100.00
distances from the residence indicated that,
Social status Freq. Percent
on average there were about 10.5, 24.3, 26.7
Not 115 63.89
and 88 meter distances in terms of irrigation
sources, DA office and weather road in munities, Participated 65 36.11
respectively. Total 180 100.00
Soil fertility status Freq. Percent
2. Descriptive statistical results for dummy
otherwise 61 33.89
variables
fertile 119 66.11
The results of the study revealed that, on average
Total 180 100.00
about 90, 68.89, 65 percents of the sample
households were male, participated in soil Source: own survey, 2017
conservation and farmers training, respectively. Table 2: Descriptive results for dummy variables.
Similarly, about 36.11 and 66.11 percents
3. Determinants of farmers’ choice of livelihood
of the sample farmers were participated in social
strategies
status and had fertile cultivated land, respectively.
Whereas, about 22, 64 and 13 percents Multinomial logit model was used to identify
of the sample farmers used human force, pack the determinants of rural households’ choice
animals and vehicles for transportation of their of livelihood strategies (Table 3). The model
farm inputs and out puts, respectively (Table 2). analysis used relying on farm alone as the base

Variable Mean Std. Dev. Min Max

Age in years 35.72778 7.439762 19 71
Education in grade 2.583333 3.659952 0 12
Family size in number 5.827778 1.703859 1 9
Economic active 2.985 1.018761 .8 6.15
Cultivated area in hector .3975694 .5414781 .0625 5
Crops output in quintal 1474.239 2511.319 240 25540
Livestock income in birr 4399.272 3873.179 0 30000
Livestock holding in TLU 3.546433 2.325793 0 8.949
Irrigation distance in minute 24.33333 11.54684 2 50
DA office distance in minute 26.71667 13.33424 2 60
W/road distance in minute 88.25 30.96888 30 180
Source: own survey, 2017
Table 1: Descriptive results for continuous variables.

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

category for no diversification and evaluates being constant, the marginal effect reveals
the other choices as alternatives to this option. that the probability of a household using
The overall model is significant at 1%. Therefore, on-farm plus non-farm and combination
in this study, only those variables, whose of on farm and off/non-farm activities
coefficients were statistically significant at less increased by 0.00043 unit. For those farm
than or equal to 10% level of significance were households output increased by one quintal.
discussed. Age of the household head, distance This is because households with large total
from irrigation sources, social status, soil fertility output can easily meet their consumption as
status, education level, distance from DA office, well as other family requirements and beyond
Economical Active members, soil fertility status, that they go for demand pull livelihood
soil conservation and transportation services outcomes (such as accumulation of assets,
used were statistically significant variables that more income, etc.). Thus, they can easily
determining rural household’s choice of livelihood overcome financial constraints to engage
strategies in the study area. in alternative non/off-farm activities. Also,
Yizengaw et al. (2015) found a positive
-- Age of household head: It affected
and significant on this variable .
farmers’ decision to diversify livelihood
strategy positively and significantly at 5% -- Soil fertility status: It positively
(Table 3). Holding other variables constant, and significantly influenced the use of crop
the likelihood of household head to choice farm and on farm plus non/off-farm livelihood
crop farming strategy increases strategies at 5% significance level (Table 3).
by 0.05 units, when age increase by one year That means, Ceteris paribus, being the farm
relative to the base category is relying on farm households soil fertility status fertile,
and livestock farming. The possible reason the probability of the households using crop
is that elder farmers are well established farming and on farm plus off/non farming
and more experienced in agricultural strategies increases by 1.08 and 2.19 units,
production, more resistant to new ideas respectively. This is explained by the fact
and information and they are more likely that fertile land is a proxy for wealth status
to be set in their ways and may not venture of farmers. Those farmers with fertile land
into new diversification activities, as also can easily meet their family food and other
revealed by other study (Fikru, 2008). requirements and have a better chance to earn
more money to invest in non-farm income
-- Education level: It was found to have
generating activities with an intention
a positive and significant effect
of accumulating assets for the future. This
on the use of farm plus off-farm strategies
result is inconsistent with the findings
at 5% significance level (Table 3). Ceteris
of Amare and Belaineh (2012).
paribus, one extra grade in the household
education increases the likelihood of using -- Developmental Agent (DA) office distance:
farm plus off/non-farm strategies It has a negative and significant impact
by 0.248 units. This could be due on diversification of livelihood strategies
to the relation between farmers education at 5% significance level (Table 3). From
in order to meet basic needs of the family the model result, other things being
relative to the benchmark alternative farm constant, the probability of a household using
alone. Furthermore, educated families are on-farm plus off/non-farm activities
able to practice multiple activities, whereas decreased by 0.06 units as DA office distance
uneducated ones tend to practice only crop increases by one minutes. The possible
production activity. This current finding justification is that extension services
is in agreement with previous observation are an important source of information
(Bezemer and Lerman, 2002). on agronomic practices. The availability
of better agricultural information
-- Total agricultural outputs: As expected,
and technical assistance on agricultural
this variable found to have a positive
activities helps farmers to produce alternative
and significant influence on household’s
crops; and to obtain higher production
choice of on-farm plus non-farm,
and income. Similar observations were also
and a combination of on-farm and off/non-
reported by other researchers (Seid et al.,
farm livelihood diversification strategies
2016).
at less than 10 % level of significance
(Table 3). From the model result, other things

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

-- Soil conservation: It has a negative and In addition, cooperatives serve as a means

significant impact on livelihood of using of gaining off-farm and non- farm
the crop farming activities only at 5% employment opportunities. This finding is
significance level (Table 3). From model inconsistent with the findings of Adugna
result, other things being constant, the use and Wagayehu (2012).
of soil conservation decreases the probability
-- Economical active members: It is found
of a household using on farm activities
to have a positive and significant effect
by 1.048 units. This is because farmers use
on the combined use of on-farm and non/off
conservation technologies to improve their
farm as a livelihood strategy at 5%
agricultural production and productivity.
significance level as compared with relying
These in turn help them to satisfy family
only on-farm activities to drive their
consumption requirements and improve
livelihood. The marginal effect reveals that,
their income rather than using a combination
holding other things constant, having one
of on-farm and non-farm activities.
more active member increases the livelihood
-- Membership to social status: As expected, of a household using combination of on-farm
this variable found to have a negative and non/off-farm activities by 0.164 units.
and significant influence on household’s This is because most of the economical
choice of only crop farming strategy active farmers were on ways of improving
at less than 5% level of significance (Table 3). agricultural production and productivity. This
The coefficient reveals that, holding in turn helps them to get better production,
other things constant, being a member and then this most likely leads to obtain more
of social status decreases the probability income to fulfill their family requirements
of a household using only crop farming by enhancing their agricultural production
strategy by 1.42 units. This is because a social skills, knowledge and experiences. The result
capital that promotes sharing of knowledge, of the study is inconsistent with the findings
information, experience, etc., regarding of Yishak et al. (2014).
the value of off and non- farm activities
that helps them to improve their livelihood.

Crop framing only Crops, livestock and off/non farming users

Variables Coefficients Std.error p>z Coefficients Std.error p>z
Age .0532166* .0284842 0.062 .0294265 .044793 0.511
Education .0516751 .0676691 0.445 .2483477** .0971032 0.011
DA distance .0138037 .0165707 0.405 -.0603002** .023963 0.012
Eco Active -.1113461 .2619369 0.671 .614172** .3124958 0.049
Cultivated .0839905 .3433125 0.807 .0676469 .4345916 0.876
Soil conservation -1.048595** .4737368 0.027 -.5460457 .6281843 0.385
Livestock -.0000624 .0000738 0.398 .000054 .0000719 0.453
Crop output -.0001857 .0002977 0.533 .0001437* .0000774 0.064
Irrigation distanc .0743335*** .0234058 0.001 -.0130695 .0381273 0.732
Farmer training -.4355286 .4814686 0.366 1.728082 1.107863 0.119
Transportation .1484154 .2707957 0.584 .610888** .2994302 0.041
Social status -1.420355** .5093427 0.005 .0863504 .5732678 0.880
Soil fertility 1.082839** .5397402 0.045 2.193368** 1.110765 0.048
Weather R dista -.0122553 .0085411 0.151 -.0180528 .0141641 0.202
constant -2.909335 1.853647 0.117 -4.390809* 2.635288 0.096
Number of obs = 180 LR chi2(28) = 129.13
Prob > chi2 = 0.0000
Log likelihood = -124.29825 Pseudo R2 = 0.3419
Note: ***, **,* means significant at 1%, 5% and10% percent level of significance
Sources: own survey result, 2017
Table 3. Multinomial logit result for determinants of livelihood strategy choices.

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
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-- Means of transportation: the model a supportive evidence of statistically

result showed that transportation positively significant effect of livelihood choice on rural
and significantly affected using a combination households livelihood outcomes measured
of on-farm and non/off-farm activities by food security and poverty status (Tables 4
as a livelihood strategy at 5% significance and 5). After controlling for pre-participation
level as compared with the base differences in demographic, location and asset
category (Table 3). The marginal effect endowment characteristics of the user
of the model reveals that, holding other and non- user households, it has been found that,
things constant, using pack animals on average, about 12.9, 45.2 and 41.9 percents
transportation in agricultural production of the sample households who using crop farming
increases the livelihood of a household using only, crop and livestock farming and crop +
a combination of on-farm and non-farm livestock and off/non farming strategies were non
activities by 0.611 units. The possible reason poor respectively. The chi square test results showed
could be better transportation most likely there were statistically significant mean differences
increase the production and productivity among these groups at 1 percent significant level
of crops produced by the farmer, and this can (Table 4).
help a farmer to get access to more food and
The survey result also indicated that, on average;
generate more income so that they satisfy
about 9.4, 30 and 19.4 percents of the sample
their family requirements. In conformity
households who using crop farming only, crop +
with the current result, Woinishet (2010)
livestock farming and crop + livestock + off/non
reported that transportation positively
farming strategies were food secured, respectively
and significantly affected using
(Table 5).
the combination of on-farm and non/off-farm
activities as a livelihood strategy. The chi square test results showed were statistically
significant mean differences among these groups
4. Impacts of livelihood strategies on rural
at 1 percent significant level (Table 5).
livelihood outcomes
This section provides evidence as to whether or not
the choices of livelihood strategies have brought
significant changes on rural livelihood outcomes.
Accordingly, the estimation result provides

Variable Livelihood strategies

Crop + Livestock
Crop farming only Crop + Livestock Total Chi2
+ off/non-farm
Numb % Numb % Numb % Numb %
Poverty Non-poor 12 6.7 42 23.3 39 21.7 93 51.7
Status Poor 38 21.1 45 25 4 2.2 87 48.3 41.958***
Total 50 27.8 87 48.3 43 23.9 180 100
Note: *** means significant at 1 percent level of significance
Sources: own survey result, 2017
Table 4: Impacts of livelihood strategies on household level poverty status.

Variable Livelihood strategies

Crop + Livestock
Crop farming only Crop + Livestock Total Chi2
+ off/non-farm
Numb % Numb % Numb % Numb %
Food Not sec 33 18.3 33 18.3 8 4.4 74 41.1
Security Secured 17 9.4 54 30 35 19.4 106 58.9 22.15***
Status
Total 50 27.8 87 48.3 43 23.9 180 100
Note: *** means significant at 1 percent level of significance
Sources: own survey result, 2017
Table 5: Impacts of livelihood strategies on household level food security status.

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Rural Households Livelihood Strategies and its Impact on Livelihood Outcomes: The Case of Eastern Oromia,
Ethiopia

Conclusion evidence of statistically significant effect

of livelihood strategies on rural household
Increasing rural livelihoods through investment livelihood outcomes measured by food security
in sustainable agricultural practices and off/non status and poverty status. The result indicated that
farming activities are important for the reduction on average, about 12.9, 45.2 and 41.9 percents
of hunger and poverty in Ethiopia. In this study, of the sample households who using crop farming
we analyzed the factors determine probability only, crop and livestock farming and crop, livestock
of livelihood choices and its contributions to rural and off/non farming strategies were non poor
households livelihood outcomes by smallholder respectively. Similarly, about 9.4, 30 and 19.4
farmers in east Oromia, Ethiopia using farm percents of the sample households who using crop
household level observations. The data were farming only, crop and livestock farming and crop,
collected from 180 sample household in 2016/17 livestock and off/non farming strategies were food
cropping year. Multinomial logit model is used secured respectively. Both results were statistically
to identify the factors that determine the probability significant at 1 percent significant level.
of the choices of livelihood strategies and mean
comparison was used for impact evaluations. Therefore, it can be concluded that household
level choice of livelihood strategies are crucial
The Multinomial result indicated that; age in increasing the households’ food security
of HH head, distance from irrigation sources, social status and reducing poverty levels of farmers
status, soil fertility status, education level, distance which in turn could affect the welfare of the rural
from DA office, Economical Active members farm households. Therefore, government
and soil fertility status, transportation and annual and non government and other stakeholders should
agricultural output were significant variables encourage the current effort of encouraging rural
determining household’s choice of livelihood livelihood diversifications which assists to improve
strategies. their farm households’ welfare by increasing their
The estimation result provides a supportive sources of income.

Corresponding authors:
Nano Alemu Daba
School of Plant Sciences, Haramaya University. P. O. box 95, Dire Dawa, Ethiopia
E-mail: [email protected]

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