Livelihood Strategies Analysis

In the study area, farmers have adopted different strategies to achieve their livelihood outcomes. About four different patterns of livelihood strategies emerge from the analysis of activity portfolios of households. Figure 2 gives a breakdown of the different livelihood strategies that households pursue in the study area. Figure 2: livelihood strategies
The descriptive statistics (pie chart) result indicated that relying only on farm activities as a livelihood strategy is the most commonly used strategy by the farmers in the study area. About 33.3% of sampled households were engaged only on-farm activity (crop and livestock production) as their livelihood strategy. Moreover, about 28.9% of the households combined on-farm activity with non-farm
The mean values of continuous variables in all livelihood categories were compared using ANOVA (F-test). The analysis of variance (ANOVA) showed the presence of significant mean difference between rural households falling in the four livelihood strategies in terms of total annual cash income and frequency of extension contact. The study showed that those farmers who were using the combination of on-farm, off-farm and non-farm activities as their livelihood had relatively better total annual cash income than the others. The mean value of total annual cash income earned by those farmers relying on combination of farm, off-farm and non-farm activities for their livelihood strategies was Birr 23200, while it was birr 17900, 8554 and 7712.6 for those households relying on farm and non-farm, farm and off-farm and farm alone to drive their livelihood respectively (table 4). It also indicated that those households depending on farm alone for their livelihood had more frequency of contact than the rest categories. The mean value of extension contact received by those farmers relying only on farm activities for their livelihood strategies was 17.4 contacts, while it was 12.85, 12.4 and 12.08 contacts, respectively, for those households relying on farm and non-farm, farm and off-farm and combination of farm,
*** indicates significant at 1% probability level. Y=0, Y=1, Y=2, and Y=3 represents on-farm only, on-farm plus off-farm, on-farm plus non-farm, and on-farm plus off-farm plus non-farm respectively.
On the other hand, a chi-square test indicated the existence of statistically significant difference between the four strategies in terms of 4 discrete variables. More specifically, the test revealed that there was significant difference between the livelihood groups in terms of the literacy status of HH heads, leadership, access to training and participation in cooperatives at less than 10% significance level (table 5).
Table 2: Summary of statistics for dummy variables by choice of livelihood strategies.
Independent variables Response Livelihood strategies of households (%) χ2 value Y= 0 Y= 1 Y= 2 Y= 3 Total
Literacy status of HHs Literate 35 46.9 46.2 63.9 46.1 7.57* no formal education 65 53.1 53.8 36.1 53.9
Leadership Yes 23.3 28.1 26.9 47.2 30 6.64* No 76.7 71.9 73.1 52.8 70
Access to training Yes 53.3 28.1 26.9 50 40.6 11.45** No 46.7 71.9 73.1 50 59.4
Membership in cooperatives Yes 40 56.2 71.2 69.4 57.8