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Determinants of Land and Labour Market Participation Decisions in Rural Ethiopia


  • Muna Shifa

    () (Post-doctoral fellow, Southern Africa Labour and Development Research Unit, University of Cape Town, South Africa)


This paper attempts to determine the factors influencing farmers' land and labour market participation decisions in rural Ethiopia. A multivariate probit estimation technique is used to account for potential interdependencies between land and labour allocation strategies. Results suggest that households that are better endowed with farming resources such as oxen and farming skills are more likely to get access to more land and labour through factor markets, while households that are less endowed with these resources are more likely to rent out their land and participate in off-farm jobs. The complementary nature of land renting out and involvement in off-farm work suggests that policy makers should give due consideration to the development of rural off-farm jobs to reduce poverty in rural areas.

Suggested Citation

  • Muna Shifa, 2016. "Determinants of Land and Labour Market Participation Decisions in Rural Ethiopia," Journal of African Development, African Finance and Economic Association, vol. 18(2), pages 73-90.
  • Handle: RePEc:afe:journl:v:18:y:2016:i:2:p:73-90

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    1. repec:spr:soinre:v:139:y:2018:i:2:d:10.1007_s11205-017-1739-5 is not listed on IDEAS

    More about this item


    Agricultural labour Markets; Land rental Markets; off-farm employment; Multivariate probit model; rural Ethiopia;

    JEL classification:

    • J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions


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