Abstract:
Despite some improvements in recent years, widespread poverty and food insecurity remain the
main challenges in Ethiopia. The challenges are exacerbated by climatic shocks such as failure
of rainfall which adversely affect agriculture and allied activities. Livelihood diversification is
accepted as the main strategy escape such type of shocks to transform the rural economy, but the
policies ignored the rich opportunities of the agricultural sector and concentrate on on-farm
only. Many studies conducted about livelihood diversification in rural Ethiopia were limited to
determinants and measuring its extent rather than investigating how it influences other equally
important welfare outcomes like food security. In light of these, this study attempted to examine
the LD strategies of rural household in Ebantu district, Oromia Regional State. For this purpose
a survey was conducted on 250 households which were selected from four villages. Stratified
random sampling was employed to select villages based on the agro-ecology zone and then
households were selected randomly and proportionally. Descriptive (frequency, percentage,
mean, pie-chart, etc.) and inferential (chi-square and ANOVA) statistics were employed. To a
large extent, determinants of livelihood strategies and level of LD strategies have been analyzed
by MNL logit econometric model. Descriptive statistics result pointed out that 22% of rural
households combined non-farm and off-farm activities instead of relying on-farm only. MNL
logit model revealed that different variables included in the model influenced the choice of
livelihood strategies. From these, credit use and crop diversification determined choice of
livelihood strategies positively, while it influenced level of LD negatively.
