ABSTRACT

This study examined the effect of diversifying livelihood strategies on the welfare status of smallholder farm households. Data were collected from 270 farm households across the state using structured questionnaire and analyzed with descriptive statistics (means and percentages) as well as inferential statistics (Heckman 2-stage model, OLS, multinomial logit and correlation models). Farming in the study area was dominated by females with mean age of 41 years as indicated from the study and implied that these farmers were in their youthful and active years of life. About 75% of the respondents had a secondary education at minimum and recorded about 17 years of experience in agricultural activities. Most farm households in Abia state are agrarian rural dwellers who depend mostly on the proceeds from their farms to survive and meet their daily food and other necessary requirements. The result of the Heckman’s two-stage selection model showed that age of household head, sex of household head, years of education, household size, farming experience, market distance, cooperative membership, use of electricity and technology all affected the decision to diversify livelihood as well as intensity of diversification. The MNL model result showed that age of the household head, sex of the household head, years of education, market distance (km), farm size, use of technology, size of livestock and total household income were the significant factors affecting the choices of different livelihood strategies. The welfare status of the households showed that majority (43%) of the farm households were extremely poor followed by 34% who were non-poor. The Ordinary Least Square (using the semi-log form as the lead equation) result showed that level of education, farming experience, credit used, livelihood diversification, total household income, sex, farm size, age of farmer and household size were welfare determining factors. The positive correlation between livelihood diversification and welfare suggested that households which diversified their livelihood sources are more likely to have better welfare conditions than those who did not. Since education of the household members positively influence income generation and diversification, improvement in the quality of education of the rural household members will improve income generation and diversification. There is a need to encourage farmers to form cooperative societies for marketing their produce and procure inputs in bulk.  Further improvements through the identification of alternative farm strategies by understanding dynamics of off-farm labour pattern in other sectors would represent a viable strategy to understand risk aversion effects on agriculture. Policy makers should formulate and ratify appropriate rural development policies and strategies based on existing situation of rural livelihood to boost development of the rural community.