Peasant households' acces to land and income diversification. The Peruvian-andean case 1998-2000

Using data for a sample of households in six villages from the North and Central Peruvian Sierra, we investigate the role played by access to assets, land in particular, in determining farm and non-farm income sources. The empirical relationship between assets and income sources is derived from a household model.Ordinary Least Square and Tobit models were used for the empirical analysis. Evidence suggests that the relationship between land and income diversification is influenced by village specific characteristics. In general, results have demonstrated the importance of assets such as natural, physical, human and social as key determinants of rural income in Peruvian Sierra. For the particular case of this study, in which families are located in a poor region with low level of economic development, it is pertinent to assume that the push factors have a decisive influence in defining the participation of these families in rural non-farm activities. That is to say, non-farm rural activities are fundamentally activities of “refuge” that allow the family to have access to a source of an immediate and relatively secure income – being less risky than agriculture – although participating in activities of low productivity.