Labor allocation to Non-agricultural Activities in Rural Ethiopia: A Gender Perspective

The aim of this paper is to identify factors influencing labor allocation decisions of adult members of farm households in rural Ethiopia. The analysis is done using a Two Part Model (TPM) based on data pooled from the first three waves of the Ethiopian Rural Socio-economic Surveys (ERSS). The results show that labor allocation is influenced by both incentive (pull/push factors) and capacity factors such as education, land size, livestock possession and non-labor income. Besides, the results suggest that there is a gender disparity in the allocation of labor to nonagricultural activities in rural Ethiopia. That is, female members of farm households are more likely to participate in nonagricultural works, and when they do, they also work more hours than the male members. Furthermore, gender differences are observed in some factors such as education, number of infants in a household, and non-labor income that affect labor allocation decisions. Therefore, policies that aim at improving efficiency of labor allocation in rural areas should take into consideration differences in responses to various factors that affect decisions of male and female members of farm households.