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Rural Nonfarm Employment and Incomes in the Eastern Himalayas

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  • Rahut, Dil Bahadur
  • Micevska, Maja B.

Abstract

Nonfarm activities generate on average about 60 percent of rural households? incomes in the eastern Himalayan region of India. This paper analyzes the determinants of participation in nonfarm activities and of nonfarm incomes across rural households. We present and explore an analytical framework that yields different activity choices as optimal solutions to a simple utility maximization problem. A unique data set collected in the eastern Himalayas allows us to closely examine the implications of the analytical framework. We conduct an empirical inquiry that reveals that education plays a major role in accessing more remunerative nonfarm employment. Other household assets and characteristics such as land, social status, geographical location, and credit access also play a role. --

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Paper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Göttingen 2007 with number 22.

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Date of creation: 2007
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Handle: RePEc:zbw:gdec07:6545

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Keywords: Nonfarm employment; Rural households; Incomes; Education; India;

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  1. Marcel Fafchamps & Agnes R. Quisumbing, 2003. "Social roles, human capital, and the intrahousehold division of labor: evidence from Pakistan," Oxford Economic Papers, Oxford University Press, vol. 55(1), pages 36-80, January.
  2. Pramila Krishnan & Stefan Dercon, 1995. "Income portfolios in rural Ethiopia and Tanzania: choices and constraints," CSAE Working Paper Series 1995-12, Centre for the Study of African Economies, University of Oxford.
  3. Dercon, Stefan, 1998. "Wealth, risk and activity choice: cattle in Western Tanzania," Journal of Development Economics, Elsevier, vol. 55(1), pages 1-42, February.
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  5. Paul Collier & Jan Willem Gunning, 1999. "Explaining African Economic Performance," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 64-111, March.
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  7. Lanjouw, Peter, 2001. "Nonfarm Employment and Poverty in Rural El Salvador," World Development, Elsevier, vol. 29(3), pages 529-547, March.
  8. Reardon, Thomas & Berdegue, Julio & Escobar, German, 2001. "Rural Nonfarm Employment and Incomes in Latin America: Overview and Policy Implications," World Development, Elsevier, vol. 29(3), pages 395-409, March.
  9. Janvry, Alain de & Sadoulet, Elisabeth, 2001. "Income Strategies Among Rural Households in Mexico: The Role of Off-farm Activities," World Development, Elsevier, vol. 29(3), pages 467-480, March.
  10. Daniel Chiquiar & Gordon H. Hanson, 2005. "International Migration, Self-Selection, and the Distribution of Wages: Evidence from Mexico and the United States," Journal of Political Economy, University of Chicago Press, vol. 113(2), pages 239-281, April.
  11. Lanjouw, Jean O. & Lanjouw, Peter, 2001. "The rural non-farm sector: issues and evidence from developing countries," Agricultural Economics, Blackwell, vol. 26(1), pages 1-23, October.
  12. Foster, Andrew D & Rosenzweig, Mark R, 2004. "Agricultural Productivity Growth, Rural Economic Diversity, and Economic Reforms: India, 1970-2000," Economic Development and Cultural Change, University of Chicago Press, vol. 52(3), pages 509-42, April.
  13. Osborne, Evan, 2001. "Culture, Development, and Government: Reservations in India," Economic Development and Cultural Change, University of Chicago Press, vol. 49(3), pages 659-85, April.
  14. Ravallion, Martin & Datt, Gaurav, 2002. "Why has economic growth been more pro-poor in some states of India than others?," Journal of Development Economics, Elsevier, vol. 68(2), pages 381-400, August.
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