Drivers of income diversification among rural households in the Ethiopian central highlands

As in most developing countries, farm households Ethiopia are often engaged several income diversification activities to mitigate risks and uncertainties faced by agriculture address poverty food insecurity. The benefits of have been widely documented the literature. However, little econometric evidence exists on drivers among Ethiopia. paper addresses this information gap investigating choice decisions intensity using data collected from a sample 385 randomly selected Ethiopian central highlands. Unlike previous studies, our multivariate probit model results show that decision is significantly interrelated had heterogeneous effects households. findings revealed age, education, livestock, land, shortage, agricultural commercialization cluster (ACC), investment sustainable farming practices, rainfall, maximum temperature impacted diversification. fractional response logit joint household decision-making, ACC, income, study site descriptive farmers (67%) tend more diversified portfolio including off-farm, forest, non-farm, crop, other sources, ranges between 0 0.76. also finds presence both synergies trade-offs different types We suggest there an urgent need improve ways sustainability small farms ensure security.