Determinants of participation in non-farm activities and its effect on household income: An empirical study in Ethiopia

Undertaking non-agrarian income-generating activities to reduce overreliance on agriculture, production failures, and income fluctuations is a household-amenable, self-insurance mechanism, which provides employment opportunities capital investment. This article examines the determinants of participation in non-farm effect household income. Heckman two-step procedure was used analyze three-wave survey data set captured from 3866 households. Crop insufficient intake food, consumption expenditure, gender, family size, literacy, health status, farm animals holding, access credit, total hired labor, cooperative membership agricultural extension services were factors influencing involvement work. Furthermore, findings establish that there decline likelihood households headed by aged people, who tend rely subsistence farming engage alternative activities. The results analyses support non-separability hypothesis income; this implies engaging non-agricultural has direct positive omnipresence generating agro-ecoregions requires inclusive rural development policies focus beyond agriculture based recognition economic heterogeneity. Key words: Rural development, activities, income, Two-Step model, Ethiopia.