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Determinants and effects of non-farm enterprise diversification on household economic wellbeing in rural Nigeria


Abdul Aziz, Sheehu and Ahmad Sidique, Shaufique Fahmi and Said, Rusmawati (2017) Determinants and effects of non-farm enterprise diversification on household economic wellbeing in rural Nigeria. International Journal of Economics and Management, 11 (1). pp. 187-204. ISSN 1823-836X


This paper examines the determinants of non-farm enterprise (NFE) diversification decision among farm households in rural Nigeria and its effects on their economic wellbeing. By employing probit model, we find that NFE diversification decision significantly depends on household head’s education, household size, and community level infrastructures. The model also indicates that households residing closer to markets are more likely to diversify into NFE activities than those in remote areas. Unique to this study, we find that households having access to social and financial capital can overcome the entry barriers associated with NFE diversification. Propensity score matching technique was used to assess the impact of NFE diversification on household economic wellbeing, using annual total consumption expenditure and food shortage status of the household as indicators of economic wellbeing. The result reveals that NFE diversification has a significant positive impact on consumption expenditure and food availability. This suggests that NFE diversification could be a pathway for improving the economic wellbeing of farm households in rural areas of developing countries.

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Additional Metadata

Item Type: Article
Divisions: Faculty of Agriculture
Institute of Agricultural and Food Policy Studies
Publisher: Faculty of Economics and Management, Universiti Putra Malaysia
Keywords: Non-farm enterprise diversification; Farm household; Economic wellbeing; Consumption expenditure; Food shortage
Depositing User: Nabilah Mustapa
Date Deposited: 31 Jul 2017 09:11
Last Modified: 31 Jul 2017 09:11
URI: http://psasir.upm.edu.my/id/eprint/56375
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