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Rural‐Urban Relations, Household Income Diversification and Agricultural Productivity

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  • Hugh Emrys Evans
  • Peter Ngau

Abstract

Does rising income from agriculture drive the growth of nonfarm activities, or does increased income from nonfarm activities spur the growth of agriculture? This paper looks at the role of nonfarm income in enabling smallholders to raise agricultural output and productivity. Based on data from a sample of farm households near Kutus town in the Kirinyaga district of Kenya, it examines these issues by looking at the use of resources for farm production, the risks attached to alternative ways of raising output and productivity, and the household's propensity to accept risk as a function of the extent to which it is able to draw on liquid assets or diversified sources of income. The authors argue that nonfarm income provides households with a form of insurance against the risks of farming, and thus enables them to adopt new production methods and raise output. They argue further that a key factor in creating opportunities for rural households to earn nonfarm income is the presence of vibrant small towns nearby.

Suggested Citation

  • Hugh Emrys Evans & Peter Ngau, 1991. "Rural‐Urban Relations, Household Income Diversification and Agricultural Productivity," Development and Change, International Institute of Social Studies, vol. 22(3), pages 519-545, July.
    • Handle: RePEc:bla:devchg:v:22:y:1991:i:3:p:519-545
    DOI: 10.1111/j.1467-7660.1991.tb00424.x
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    References listed on IDEAS

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    1. Collier, Paul & Lal, Deepak, 1984. "Why poor people get rich: Kenya 1960-1979," World Development, Elsevier, vol. 12(10), pages 1007-1018, October.
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    3. Massell, Benton F & Parnes, Andrew, 1969. "Estimation of Expenditure Elasticities from a Sample of Rural Households in Uganda," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 31(4), pages 313-329, November.
    4. Low, A R C, 1981. "The Effect of Off-Farm Employment on Farm Incomes and Production: Taiwan Contrasted with Southern Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 29(4), pages 741-747, July.
    5. Rohrer, Wayne C, 1986. "Developing Third World Farming: Conflict between Modern Imperatives and Traditional Ways," Economic Development and Cultural Change, University of Chicago Press, vol. 34(2), pages 299-314, January.
    6. Hazell, P. B. R. & Roell, Ailsa, 1983. "Rural growth linkages: household expenditure patterns in Malaysia and Nigeria," Research reports 41, International Food Policy Research Institute (IFPRI).
    7. Shahabuddin, Quazi & Mestelman, Stuart & Feeny, David, 1986. "Peasant Behaviour towards Risk and Socio-Economic and Structural Characteristics of Farm Households in Bangladesh," Oxford Economic Papers, Oxford University Press, vol. 38(1), pages 122-130, March.
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