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Income diversity in rural Lithuania: benefits, barriers, and incentives


  • Dirk J. Bezemer

    (Overseas Development Institute, London. Imperial College, University of London)

  • Jurgita Rutkauskaite

    (Lithuanian Institute of Agrarian Economics)


Economic hardship, agricultural policy reform and price developments have adversely affected incomes from agricultural production in Lithuania, and many farm households have accessed additional sources of income in the rural economy. In an analysis of recently collected survey data we find that non-farm wage employment particularly benefits poorer household, whereas non-agricultural enterprises are more common among higher-income farm households. Such enterprises diminish transaction problems typical for transition economies, allow households to capture more value added than in agricultural production, and create jobs in the local economy. Non-agricultural enterprises are more likely to be found with larger households and in more remote areas. Non-agricultural employment are more important income components for households that have more dependant members, are located in remoter areas, and have less access to economic institutions. We discuss the implications of these findings for the role of rural income diversity in economic regeneration.

Suggested Citation

  • Dirk J. Bezemer & Jurgita Rutkauskaite, 2003. "Income diversity in rural Lithuania: benefits, barriers, and incentives," UCL SSEES Economics and Business working paper series 32, UCL School of Slavonic and East European Studies (SSEES).
  • Handle: RePEc:see:wpaper:32

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    References listed on IDEAS

    1. M. Rose Olfert, 1992. "Nonfarm, Employment as a Response to Underemployment in Agriculture," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 40(3), pages 443-458, November.
    2. Ferreira, Francisco H. G. & Lanjouw, Peter, 2001. "Rural Nonfarm Activities and Poverty in the Brazilian Northeast," World Development, Elsevier, vol. 29(3), pages 509-528, March.
    3. D. M. Shucksmith & R. Smith, 1991. "Farm Household Strategies And Pluriactivity In Upland Scotland," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(3), pages 340-353.
    4. Macours, Karen & Swinnen, Johan F M, 2002. "Patterns of Agrarian Transition," Economic Development and Cultural Change, University of Chicago Press, vol. 50(2), pages 365-394, January.
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    More about this item


    transition; Lithuania; rural economy; incomes; survey data;

    JEL classification:

    • P46 - Economic Systems - - Other Economic Systems - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure


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