Abstract
The study is aimed at exploring patterns and prospects of livelihood diversification through small business using a comparative study in three climatic zone of rural Ethiopia. Although rural households, who are primarily agricultural, used to deploy their resources between farm and rural small business to diversify incomes and reduce the inherent risk embedded in the dependence of agricultural production, little attention is given by policy makers to diversification out of agriculture as a peasant survival strategy. With respect to the types of small business, participant households in all climatic zone are engaged in different business activities from which goat, sheep, fatten ox and chat trading are the major one. To exploit the benefit that could be obtained from small business and thereby improve food security in the rural area, proper attention should be given by the government to enhance the existing small business as expansions of such schemes are a necessary condition for the gradual reduction of agricultural labor force. Keywords: Livelihood diversification, Small business, Rural households DOI : 10.7176/EJBM/11-28-01 Publication date :October 31 st 2019
Highlights
In most Sub-Saharan African (SSA) countries, rural households are frequently not able to support themselves from their farms income (Deborach 1999)
Rural households, who are primarily agricultural, used to deploy their resources between farm and non-farm activities to diversify incomes and reduce the inherent risk embedded in the dependence of agricultural production, little attention is given by policy makers to diversification out of agriculture as a peasant survival strategy (Block &Webb 2001)
Small business development in rural area has fallen in to an “Institutional Vacuum”, since it has not belonged to the domain of Agricultural Ministries, with their mandate related to farming per se, or to that of Industry Ministries, which commonly focus on urban large-scale, companies (Tassew 2000)
Summary
In most Sub-Saharan African (SSA) countries, rural households are frequently not able to support themselves from their farms income (Deborach 1999) In these regard, many researchers confirmed that, in rural area of Ethiopia the number of poor people exceeds the capacity of agriculture to provide sustainable livelihood opportunities. The conventional sector based approach employed to analyze the Ethiopian economy, categorizing it as agriculture- industry have contributed to the relative neglect of the rural small business development In these regard, present Ethiopian government is criticized by some quarters for pursuing rural development policies that neglect the role of small business in rural areas. Natural Capital Natural Capital comprises the natural resources such as water, land and common property resources that are so central to rural livelihoods These resources provide a foundation for much of the small business (Ellis 1999). Through such a mixed way of data generation the limitation of one was offseted by the other
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