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Abstract:
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This paper tests various factors affecting household income diversification in the Tigray region of Ethiopia by pooling diversification measurement techniques from several different frameworks in the standard literature on the rural non-farm economy. The paper conducts a brief review of existing frameworks along with their strengths and weaknesses. The review uncovers some ideas as to how the various theoretical frameworks could be combined to create a better diversification index. This index is tested against previously recognized determinants of diversification. The differences in results between the poorer and wealthier households in the sample suggest the necessity of the careful targeting of rural development policies. |