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Employment dynamics in the rural nonfarm sector in Ethiopia Do the poor have time on their side?

Bezu, Sosina and Barrett, Christopher B. (2010): Employment dynamics in the rural nonfarm sector in Ethiopia Do the poor have time on their side?

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Abstract

We study rural employment transitions in Ethiopia between farming and both low- and high-return nonfarm employment. We find that initial asset holdings and access to saving and credit are important factors for transition into high-return rural nonfarm employment and that households’ participation in high-return rural nonfarm activities is robust to their experience of health shocks. However, shocks that affect their wealth or liquidity may trigger descents into low-return nonfarm employment. On the other hand, shocks that reduce agricultural income motivate transitions into high-return rural nonfarm employment.

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