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Employment dynamics in the rural nonfarm sector in Ethiopia Do the poor have time on their side?

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  • Bezu, Sosina
  • Barrett, Christopher B.

Abstract

We study rural employment transitions in Ethiopia between farming and both low- and high-return nonfarm employment. We find that initial asset holdings and access to saving and credit are important factors for transition into high-return rural nonfarm employment and that households’ participation in high-return rural nonfarm activities is robust to their experience of health shocks. However, shocks that affect their wealth or liquidity may trigger descents into low-return nonfarm employment. On the other hand, shocks that reduce agricultural income motivate transitions into high-return rural nonfarm employment.

Suggested Citation

  • Bezu, Sosina & Barrett, Christopher B., 2010. "Employment dynamics in the rural nonfarm sector in Ethiopia Do the poor have time on their side?," MPRA Paper 35756, University Library of Munich, Germany, revised 2011.
    • Handle: RePEc:pra:mprapa:35756
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    More about this item

    Keywords

    rural nonfarm; income diversification; employment transitions; Ethiopia; shocks;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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