Does the Nonfarm Economy Offer Pathways for Upward Mobility? Evidence from a Panel Data Study in Ethiopia
AbstractEmpirical studies across many developing countries routinely document a positive correlation between participation in rural nonfarm employment and households’ wealth or income. This paper explores whether nonfarm employment leads to higher consumption expenditure growth in Ethiopia. We find that: (1) households’ consumption expenditure growth is positively correlated with the initial share of nonfarm income; (2) the growth elasticity of nonfarm income share is higher for wealthier households; and (3) the main source of growth for nonfarm participants comes from the higher rates of return participants enjoy on their human and physical capital.
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Bibliographic InfoArticle provided by Elsevier in its journal World Development.
Volume (Year): 40 (2012)
Issue (Month): 8 ()
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Web page: http://www.elsevier.com/locate/worlddev
rural nonfarm; income dynamics; income diversification; Africa; Ethiopia; impact;
Other versions of this item:
- Bezu, Sosina & Barrett, Christopher B. & Holden, Stein T., 2010. "Does the nonfarm economy offer pathways for upward mobility? Evidence from a panel data study in Ethiopia," MPRA Paper 35754, University Library of Munich, Germany, revised 2011.
- D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
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