Abstract

This study was carried out to analyze the institutional and environmental factors influencing livelihood diversification by rural farmers in Toro local government area of Bauchi State. Data for the study were collected using questionnaires administered to respondents who were selected randomly. Data collected were analyzed by means of descriptive statistics, Foster, Greer and Thorbecke (FGT), Herfindahl index and OrderedProbit regression model. The result showed that the main reason why farmers engage in livelihood diversification activities was to raise household’s income portfolioostensibly to enhance food security. FGT analysis for poverty level of farmers reveal that the poverty line was constructed to be at per capita monthly expenditure equal or higher than (N1,780). The poverty count index (P0) for the entire household was 0.517, this means 52% of the farming household in the study area were poor. The Herfindahl index showed that most of the household heads had more than 2 sources of income. The Ordered Probit regression analysis indicates that credit received and season of the year were significant determinants of livelihood diversification at 1% level while accessibility to market and natural resources available to the farmers were significant at 5% level. As a deliberate strategy to encourage farmers to diversify, it is recommended that soft loans should be made available to the farmers and also they should be educated on how to use natural resources around them sustainably. These will enable them to be food secured and liberate them from the hold of poverty.

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