IDEAS home Printed from
   My bibliography  Save this paper

Determinants of Time Allocation to Rural Non-Farm Activities in Central America: The Role of Infrastructure and EducationI


  • Barron, Manuel
  • Torero, Maximo


We estimate a bivariate Tobit model to find the main determinants of time allocation to rural nonfarm employment (RNFE) among rural households in four Central American countries: ElSalvador, Guatemala, Honduras, and Nicaragua. The main effects stem from gender and schooling of the household head, as well as access to infrastructure, with evidence of infrastructure complementarities, i.e. we identify increasing share of nonfarm activities when the household has simultaneously more than one infrastructure. Households from the poorest income quartile would allocate between 3 (Guatemala) to 8 (El Salvador) additional hours to nonfarm activities if they increase their access from 0 to 2 types of infrastructure. This apparently small change in time allocation (substituting time in farm by time out of the farm, leaving leisure intact) would have non-negligible impacts in income, which would increase by 6% in Guatemala and 11% in El Salvador. Moreover, infrastructure access variables are positive for all income quartiles, but the marginal effect is positively correlated with income, i.e. the poor would benefit less than the rich... Finally, the model also shows an inverted U-shape in the relationship between the expected number of hours in RNFE and income. The more the households specialize in agriculture the less time they allocate to RFN. The richest households (roughly the top 1%) specialize in agriculture and thus allocate less time (zero in the case of El Salvador and Guatemala) to RNFE.

Suggested Citation

  • Barron, Manuel & Torero, Maximo, 2012. "Determinants of Time Allocation to Rural Non-Farm Activities in Central America: The Role of Infrastructure and EducationI," MPRA Paper 61421, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:61421

    Download full text from publisher

    File URL:
    File Function: original version
    Download Restriction: no

    References listed on IDEAS

    1. McFadden, Daniel & Ruud, Paul A, 1994. "Estimation by Simulation," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 591-608, November.
    2. Reardon, Thomas, 1997. "Using evidence of household income diversification to inform study of the rural nonfarm labor market in Africa," World Development, Elsevier, vol. 25(5), pages 735-747, May.
    3. Bryceson, Deborah Fahy, 1996. "Deagrarianization and rural employment in sub-Saharan Africa: A sectoral perspective," World Development, Elsevier, vol. 24(1), pages 97-111, January.
    4. Carletto, Gero & Covarrubias, Katia & Davis, Benjamin & Krausova, Marika & Stamoulis, Kostas G. & Winters, Paul C. & Zezza, Alberto, 2007. "Rural Income Generating Activities in Developing Countries: Re-assessing the Evidence," eJADE: electronic Journal of Agricultural and Development Economics, Food and Agriculture Organization, Agricultural and Development Economics Division, vol. 0(Issue 1), pages 1-48.
    5. Bryden, John & Bollman, Ray, 2000. "Rural employment in industrialised countries," Agricultural Economics, Blackwell, vol. 22(2), pages 185-197, March.
    6. Javier Escobal & Máximo Torero, 2005. "Measuring the Impact of Asset Complementarities: The Case of Rural Peru," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 42(125), pages 137-164.
    7. Dixon, Ruth B, 1982. "Mobilizing Women for Rural Employment in South Asia: Issues of Class, Caste, and Patronage," Economic Development and Cultural Change, University of Chicago Press, vol. 30(2), pages 373-390, January.
    8. Stein Kristiansen, 2003. "Linkages and Rural Non-Farm Employment Creation: Changing Challenges and Policies in Indonesia," Working Papers 03-22, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    9. Levenson, Alec R, 2000. "The Role of Agricultural and Female Labor Mobility in Taiwan's Industrialization: 1976-91," Review of Development Economics, Wiley Blackwell, vol. 4(1), pages 101-119, February.
    10. Haggblade, Steven & Hazell, Peter B. R. & Reardon, Thomas Anthony (ed.), 2007. "Transforming the rural nonfarm economy: Opportunities and threats in the developing world," IFPRI books, International Food Policy Research Institute (IFPRI), number 978-0-8018-8664-5.
    11. David Shapiro & Sharon Shapiro, 1994. "Rural employment and rural-urban differences in employment in Zaire: A comparative perspective," The Review of Black Political Economy, Springer;National Economic Association, vol. 23(2), pages 57-70, December.
    12. Bryden, John Marshall & Bollman, Ray D., 2000. "Rural employment in industrialised countries," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 22(2), March.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Infrastructure Non-farm activities Rural employment;

    JEL classification:

    • J0 - Labor and Demographic Economics - - General
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:61421. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.