The Determinants of Nonfarm Activities and Incomes of Rural Households in Mexico,with Emphasis on Education

This paper presents the main results of a study of the effects of education (as well as other household assets) on the choice of activities and incomes of rural Mexican households. Our study examines the various income sources, as well as the education of the household's head and its members. Implications are drawn for rural education and development policies to promote rural nonfarm incomes and employment.     

Non‐farm Income Diversification in Rural Ghana: Patterns and Determinants

Abstract: Evidence abounds in the rural livelihoods literature that rural households do not only receive a significant proportion of their incomes from non‐farm sources, but also it is a significant source of employment for rural folks. This paper examines the pattern and determinants of non‐farm income diversification in rural Ghana. Results show that off‐farm income constituted 43 percent of rural household income in 2005/6. Female‐headed households tend to have larger off‐farm income shares compared to male‐headed households. Non‐farm income shares followed the same gender pattern albeit less pronounced. Unlike in Latin America and Asia, in rural Ghana, non‐farm self‐employment income is more important than non‐farm wage‐employment income. Regression results show that the gender composition of households, age, education, and access to credit, electricity and markets are important determinants of multiple non‐farm activities and non‐farm income. The findings call for strategies that can help rural households maximize the benefits from income diversification.     

Diversify and prosper: Peasant households participating in emerging markets in northeast rural China

Following the sequence of radical rural reforms commencing in 1978, many peasant households in the People's Republic of China (PRC) have been actively diversifying away from time-honored grain production. This article examines the microlevel rewards accruing to a sample of village households located in the northeast province of Liaoning. In particular, we identify and then measure how such diversification affects household income, the level of employment, and the returns to labor. Two explanatory variables are constructed as surrogates for income-source diversification in a series of household production functions. Our results provide robust evidence that households that move from grain enhance significantly several indicators of their economic well-being.     

Rural Nonfarm Employment and Incomes in Chile

This article analyzes the evolution of rural nonfarm employment (RNFE) and income in Chile during 1990–96. The data used come from the National Socioeconomic Survey (CASEN), and from a household survey undertaken by the authors in two municipalities in 1999. The latter contrasted two zones, very different in terms of economic dynamism and rural poverty. We show that during the period, RNFE and incomes increased 10% and 18%, respectively, in 1996, reaching 39% of rural employment and 41% of rural incomes. The rate of multiactivity (the share of households participating in more than one sector) was only 20%, lower than expected, indicating a tendency toward economic specialization in rural income strategies. The determinants of such employment are mainly household characteristics, in particular variables related to human capital, such as the age and gender of the household head, and the schooling of the household members, although also important are access to credit and physical capital. The level of nonfarm income of rural households is determined mainly by the economic context, in particular the economic level and dynamism of the overall zone and the quality of the roads. It is proposed that policies to develop RNFE should be geared to zone characteristics, and should in general favor investments in education, in roads, and in access to credit. Moreover, households headed by women should be the object of special attention. To promote such policies, it will be necessary to address important gaps and weaknesses in the public institutional structure.     

Shocks and rural livelihoods in the Okavango Delta,Botswana

This paper describes the impacts that three shocks in the Okavango Delta, Botswana, have had on rural livelihoods: the desiccation of river channels, animal diseases, and HIV/AIDS. Primary data was collected from five study areas, using formal questionnaire interviews and focus group discussions. The paper reveals the adverse effects on rural livelihoods. It describes the way households have been exposed to poverty and vulnerability and the various ways they have coped or adapted, such as by re-allocating their labour, liquidating their assets to cover medical expenses and funeral costs, reducing the area ploughed for crops, hiring labour, digging wells and switching from flood recession agriculture to dryland farming. The Botswana government has provided safety nets to help households cope, but this paper recommends that people's responses to these shocks should be taken into account in future policy and programme formulation.     

Rural Nonfarm Employment and Incomes in Latin America: Overview and Policy Implications

Rural nonfarm employment (RNFE) and incomes (RNFI) are crucial to Latin American rural households. The 11 rural household income studies in this volume, reviewed in this paper, use 1990s data and show that RNFI averages 40% of rural incomes. RNFI and RNFE have grown quickly over the past three decades. The review of evidence provided some surprising departures from traditional images of nonfarm activities of Latin American rural households. In terms of shares of rural incomes: (1) nonfarm wage incomes exceed self-employment incomes; (2) RNFI far exceeds farm wage incomes; (3) local RNFI far exceeds migration incomes; (4) Service-sector RNFI far exceeds manufactures RNFI. These findings suggest the need for more development program attention to wage employment in the service sector, versus the traditional focus on small enterprise manufactures. Moreover, poor households and zones tend to have higher shares in their incomes but lower absolute levels of RNFI as compared to richer households and zones. The RNFE of the poor tend to be the low-paid nonfarm equivalent of semi-subsistence farming. Raising the capacity of the poor to participate in the better-paid types of RNFE is crucial — via employment skills training, education, infrastructure, credit. Finally, RNFE has grown fastest and been most poverty-alleviating where there are dynamic growth motors, in particular in the agricultural sector, but also in tourism, links to urban areas, mining and forestry. This means that developing RNF jobs cannot be done at the expense of programs promoting agricultural development.     

Rural–urban differences in parental spending on children's primary education in Malawi

Using Malawian data, this paper answers two interrelated questions: are there rural–urban differences in the factors that influence the probability that a household spends or does not spend on own children's education; and are there rural–urban differences in the factors that affect educational expenditure if a household decides to spend? Computed elasticities indicate that spending on education by rural households is more sensitive to changes in income compared with urban households, suggesting that spending on education in rural areas is a luxury good. In both areas, a mother's employment and education has a larger impact on spending compared with those of a father. Urban households compared with their rural counterparts are more sensitive to the quality of access to primary schools. We find no evidence of gender bias in school spending in urban areas, but rural households exhibit bias in favour of boys.     

Some poor and invisible women: Farm labourers in South Africa

This article presents the results of a prevalence survey carried out in 1994 to assess the socio‐economic significance of waged farmwork in parts of the Eastern Transvaal (now Mpumalanga). The survey was designed to shed light on the question of how many rural households depend for their survival on the availability of wage employment opportunities for women on farms. The results support the view that economists and statisticians in South Africa have paid insufficient attention to the importance of unrecorded, or statistically ‘invisible’ agricultural wage employment to the rural population. In particular, the importance of women's work as waged farm labourers has not received the attention it deserves for policy purposes. Women's wages and working conditions on all types of farms are probably the critical determinants of the standard of living of many tens of thowsands of households in Mhala and Mapulaneng, and of many millions of the poorest households in South Africa as a whole.     

The determinants of poverty dynamics in Indonesia: evidence from panel data

We use the ‘spell’ approach to identifying poverty and apply an ordered logit model to examine the determinants of poverty dynamics in Indonesia, categorising households as poor, transient poor (–), transient poor (+) or non-poor. Observing the National Socio-Economic Survey (Susenas) balanced-panel data sets of 2005 and 2007, we found that 28% of poor households are classified as chronically poor (that is, remaining poor in two periods) while 7% of non-poor households are vulnerable to being transient poor (–). Our estimations confirmed that the determinants of poverty dynamics in Indonesia are educational attainment, the number of household members, physical assets, employment status, health shocks, the microcredit program, access to electricity, and changes in employment sector, employment status and the number of household members. We also found that households in Java–Bali are more vulnerable to negative shocks than those outside Java–Bali.     

The role of off-farm employment in the rural energy consumption transition — A village-level analysis in Jiangxi Province, China

Energy consumption in rural areas in China is characterized by high consumption of fuelwood, straw and other biomass. Off-farm employment can play an important role in the transition towards more sustainable sources of energy by increasing rural household incomes and reducing the amount of labor available for biomass collection. The purpose of this paper is to examine the impact of off-farm employment on rural household energy consumption choices, and to disentangle the various causal relationships that play a role in this respect. To this end, a hybrid farm household/village computable general equilibrium (CGE) model is used that has been calibrated for a remote village in Northeast Jiangxi Province where fuelwood is the main source of energy. The model takes into account nonseparability of farm household production and consumption decisions as well as linkages within the village between households involved in off-farm employment and households with no members working off-farm. Contrary to previous research for a richer region in rural China, we find that fuelwood is not an inferior good. The positive impact of more food consumption on fuelwood collection more than compensates the higher leisure demand associated with higher incomes. Shifts in production activities and in prices on village factor markets caused by increased labour scarcity (the lost-labour effect of off-farm employment), on the other hand, cause a reduction in fuelwood collection and consumption. This lost-labour effect is much stronger for migration than for local off-farm employment, because the latter can more easily be combined with on-farm work and fuelwood collection. For local off-farm employment the income effect dominates the lost-labour effect, resulting in a positive overall impact of higher off-farm participation on fuelwood consumption. For migration, on the other hand, the income effect and the lost-labour effect are almost equal in size. Hence, the amount of fuelwood collected and consumed does not change much when households participate in migration. The final conclusion is therefore that increased off-farm employment opportunities do not promote the transition of rural energy use in the poorer regions of rural China.     

Self-employment of Chinese rural labor force: Subsistence or opportunity?—An empirical study based on nationally representative micro-survey data

Self-employment is an essential form of non-agricultural employment, and its nature has been rarely identified in recent studies. From the perspectives of the human capital, social capital, and family assets of rural laborers, this study focuses on determining self-employment by using the nationally representative data on the rural labor force in China. Through the static comparative analysis between three groups of laborers in self-employment, wage employment, farming, and the dynamic comparative analysis of laborers entering into and exiting from self-employment, the study shows that self-employment of rural laborers in China is almost opportunity-driven or moving toward opportunistic self-employment. Human capital, social capital, and family assets promote rural laborers shifting from wage employment to self-employment and stimulate the establishment of high-value enterprises. The study suggests that local governments should increase the investments in rural education and vocational skills training and strengthen the availability of rural credit to lay a good foundation for self-employment activities in rural areas.     

HOW DO POOR RURAL HOUSEHOLDS IN MYANMAR COPE WITH SHOCKS? COPING STRATEGIES IN A FISHING AND FARMING VILLAGE IN RAKHINE STATE

This paper examines how poor rural households in Myanmar cope with shocks which incur unexpected expenditure, namely, the sickness or death of a household member, using data collected in a fishing and farming village in Myanmar in 2008. The paper analyzes the sequence of coping strategies and the background factors behind the sequence. Self‐insurance, the dissaving of assets or cash, is given priority over intra‐party strategies, such as loans or gifts. The reason for this lies in the persistent severe credit constraints faced by households, both in terms of access and cost (high level of interest rates), and the absence of strong social norms for mutual insurance in the community. Both factors appear to force these households to self‐insure themselves from the outset.     

Nonfarm Employment and Poverty Alleviation of Rural Farm Households in Honduras

This paper analyzes the role of nonfarm income of rural farm households in Honduras. It uses the national income and expenditure survey from 1993 to 1994. Income from nonfarm wage and self-employment represents 16–25% of farm household income and is especially important for middle and higher income strata. Nonfarm wage labor is geographically concentrated in small rural towns and in the industrial free zones located in the Northern region, while self-employment is particularly developed in the Southern region. Access to nonfarm wage employment is confined to educated individuals that belong to large households, while female members of wealthier households are mainly involved in self-employment. Food security is strongly enhanced through the engagement in nonfarm activities. Moreover, nonfarm income enables farmers to purchase external inputs for improving yields and labor productivity. Suitable policies to enhance nonfarm employment include education, training, and technical assistance to reduce labor intensity in agricultural production, as well as public investment and credit services to improve access to nonfarm activities.     

Guaranteeing employment to the rural poor: Social functions and class interests in the employment guarantee scheme in Western India

Numerous observers rightly term the landless rural population the ‘most intractable development problem’ in poor societies. Given the extraordinary political and administrative obstacles to redistrubution of rural assets in India (the widely-recognized failture land reforms), attention and finances have recently been focused on public rural employment programmes to alleviate rural distribution. Within India, the State of Maharashtra, with a size and population of a large European nation, has instituted a striking departure from traditional rural works programmes: a guarantee of employment to rural adults on demand. The Employment Guarantee Scheme in one state has since become a significant policy model, and the experience in that state provides something like a laboratory for its analysis. Based on analysis of previous studies and original field work in rural Maharashtra, the article argues that the scheme is something of a rare bird: a programme which seems to be in the objective and subjective interests of the rural poor, as well as consistent with the interests of the rural landed elite, despite their early political objections. The fiscal structure of the scheme is a direct contradiction of Lipton's (1977) model of ‘urban bias’ in Third World development strategies; the Employment Guarantee Scheme is rather more a manifestation of ‘kulak power’. Though promulgated as an alternative to policies entailing redistribution of rural assets, and clearly superior to doing nothing about rural distribution, the scheme is inferior to genuine redistribution in terms of altering the rural political economy. The functions, if not the motivations, of the scheme are profoundly conservative in a structural sense, politically and economically; the philosophical underpinnings, and perhaps, potentially, the consequences for mobilization of the rural poor, are quite the opposite.     

The Impact of Lending to Women on Household Vulnerability and Women’s Empowerment: Evidence from India

Impact evaluation studies routinely find that lending to women benefits their households. However, a number of them also find that this may not empower the women concerned. This seemingly paradoxical conclusion is confirmed by our study with respect to a lending program in rural India. We investigate this result by examining a combination of loan-use data and borrower-testimonies. We find that loans procured by women are often diverted into enhancing household’s assets and incomes. This combined with woman’s lack of co-ownership of family’s productive assets, we conclude, results in her disempowerment. If empowering women is a crucial objective, then the patriarchal hold on productive assets must be challenged.     

Migration and the changing social economy of Windhoek,Namibia

This study focuses on the economic strategies employed by poor urban households in Windhoek, Namibia. It is based on the findings of a household questionnaire survey conducted in Windhoek and qualitative case studies collected in both Windhoek and the rural northern regions of Namibia. The central argument of this article is that rural–urban migration in Namibia is not unilinear but involves a complex relationship between rural and urban households that is fostered by high levels of personal mobility between the rural and urban settings. These close and complex social linkages between the rural and urban sectors make it possible for people to withstand the economic difficulties associated with limited employment in the formal urban economy. Further, this study shows that a key survival factor for urban households is in fact food that is produced in the rural areas.     

Accessibility to microcredit by Chinese rural households

This paper examines the factors influencing the accessibility of microcredit by rural households in China. The empirical analysis utilises logistic regression, with data collected through a household survey carried out in one province in China. A total of twelve household-level factors are identified as determinants in households’ access to microcredit, including educational level, household size, income, among others. In addition to these, results indicate that rural households’ accessibility to microcredit can also be impaired by the supply-side factors (e.g., interest rates, loan processing time). The empirical analysis establishes a positive relationship between households’ credit demand and access to credit. The paper thus concludes that households should be encouraged to raise capital requirements (for example, create investment opportunities in on/off farm activities) to increase their demand for credit, which can enhance their access to microcredit. In addition, microcredit institutions (such as the Rural Credit Cooperatives) should improve their lending schemes and micro loan products to better suit the diversified needs of the rural population.     

农村劳动力外出就业能力培训体系建设研究

农村劳动力外出就业能力培训是我国农村人力资源开发的重要内容。在当前农村劳动力外出就业能力普遍较低的情况下,通过就业能力培训促进其就业能力的提高具有重要的意义。本文从目前农村劳动力外出就业能力的现状出发,提出了以适应市场经济的职业技能培训、发展农村职业教育和创新就业培训机制为主要内容的农村劳动力外出就业能力培训体系的建设。     

Social Capital, Household Welfare and Poverty in Burkina Faso

This paper investigates empirically the importance of socialcapital, in the form of local associations and networks, forthe welfare of rural households in Burkina Faso. It draws ona unique database combining standard information on householdwelfare with multidimensional measures of social capital. Theanalysis finds that higher levels of social capital are associatedwith higher household per capita expenditures and better accessto credit. The distribution of social capital was found to bemore equal than that of other assets. Poor households and thosewho own little land obtain a higher return from social capitalthan other households.     

Poverty in Zambia: Levels,patterns and trends

This article presents the results of the analysis of levels, patterns and trends in the incidence of poverty in Zambia between 1991 and 1998, based on data captured in nationally representative surveys. In 1998, about 73 per cent of the households in Zambia were poor, the majority of which were extremely poor. Most poor households were in rural areas, with wide inter- and intra-provincial and district variations. The incidence of poverty also varied according to employment status and sector, as well as by district, gender, marital status, education and stratum of head of the household. In general, households headed by females, those without any formal education, unpaid family workers, the inactive, the self-employed, and those in agriculture, forestry and fishing recorded the highest incidence of poverty, with those employed in private households being affected the worst. In spite of the general increase in poverty nationally, most rural provinces registered declines while urban areas experienced increases in the incidence of poverty during the period under review. Furthermore, except for the agricultural/forestry, mining and quarrying, and electricity and gas sectors, the incidence of poverty increased in all the other sectors while remaining almost the same in the real estate sector. The direction and magnitude in the incidence of poverty between 1991 and 1998 were also associated with gender, education, employment status, employment sector, and residence of head of the household, as well as size of the household. Based on the analysis, the article strongly recommends revision in the measurement of poverty, investigation of the types of coping strategies adopted by the poor, and the extent to which these impact on the general well-being and productivity of vulnerable households in Zambia. The need for more qualitative data has also been highlighted.