An analysis of net farm income to guide agricultural policies in the Ethiopian highlands

Abstract Background As part of a larger food security project under Ethiopia’s Agricultural Growth Program (CASCAPE), 928 farms in the Ethiopian Highlands were surveyed between 2012 and 2017. The aim was to determine whether Net Farm Income (NFI) is relevant indicator that drives at household farm level, its drivers across six study regions Ethiopia (i.e., Addis Ababa, Hawassa, Haramaya, Bahir Dar, Jimma, Mekelle). effect different socio-economic environmental on NFI determined using descriptive statistics, correlation analysis, k-means clustering comparison high low quartiles per region. Results average annual just below 1000 US$ household, with Ababa region leading. Jimma Dar above average, others lower end. In best explained by size, net cash flow use nitrogen fertilizer. Male-headed households earned considerably more than female-headed households. yielded two major types basis significant differences rainfall, education crop diversity, N fertilizer use. An analysis richest 25% versus poorest showed Mekelle all had diversity use, whereas Hawassa Haramaya seem homogeneous. Conclusions survey results present new entry points for informed decision making through targeted, area-specific policies virtue insight regional spread driving forces. Important deductions from are policy actions obtainable results. For example, farm-size variable provides an type action required sizes generate sufficient returns overall farming investment. Next, cash-flow speaks idea amount hard-cash needed enable it get meaningful invested farming, or guaranteed minimum return any specific crop(s) animal production. Nitrogen as predominantly productivity indicator. order be sustainable, there need articulation yields crops. Finally, location rainfall parameters require recommendations management correspond amount, soil types, ecological zones distance markets maybe gleaned