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Boda Bodas Rule: Non-agricultural Activities and Their Inequality Implications in Western Kenya

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  • Jann Lay
  • George Michuki M'Mukaria
  • Toman Omar Mahmoud

Abstract

Engagement in non-agricultural activities in rural areas can be classified into survival-led or opportunity-led. Survival-led diversification would decrease inequality by increasing the incomes of poorer households and thus reduce poverty. By contrast, opportunity-led diversification would increase inequality and have a minor effect on poverty, as it tends to be confined to non-poor households. Using data from Western Kenya, we confirm the existence of the differently motivated diversification strategies. Yet, the poverty and inequality implications differ somewhat from our expectations. Our findings indicate that in addition to asset constraints, rural households also face limited or relatively risky high-return opportunities outside agriculture.

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1314.

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Length: 30 pages
Date of creation: Mar 2007
Date of revision:
Handle: RePEc:kie:kieliw:1314

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Keywords: Income diversification; non-agricultural activities; inequality; poverty; sub-Saharan Africa; Kenya;

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References

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Citations

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Cited by:
  1. Atamanov, Aziz & Van den Berg, Marrit, 2011. "Microeconomic analysis of rural nonfarm activities in the Kyrgyz Republic: What determines participation and returns?," MERIT Working Papers 011, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  2. Lay, Jann & Schüler, Dana, 2008. "Income Diversification and Poverty in a Growing Agricultural Economy: The Case of Ghana," Open Access Publications from Kiel Institute for the World Economy 39907, Kiel Institute for the World Economy (IfW).
  3. World Bank, 2009. "Kenya - Poverty and Inequality Assessment : Executive Summary and Synthesis Report," World Bank Other Operational Studies 3081, The World Bank.
  4. Liverpool, Lenis Saweda O. & Winter-Nelson, Alex, 2010. "Poverty Status and the Impact of Formal Credit on Technology Use and Wellbeing among Ethiopian Smallholders," World Development, Elsevier, vol. 38(4), pages 541-554, April.

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