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Accepted Paper:

Impact of Livelihood and Crops Diversification on Households’ Poverty: Insights from Rural Afghanistan  
Mohammad Reza Ehsan (South Asian University)

Abstract:

Abstract:

We explore the impacts of Livelihood and Crop Diversification on poverty within Afghanistan's rural households. Employing data from the Afghanistan Living Condition Survey (ALCS) for 2016-2017, sourced from the National Statistics and Information Authority (NSIA) of Afghanistan, the research sheds light on critical dimensions.

Descriptive statistics unveil a notable trend, depicting an upswing in the poverty rate from 33.7 in 2007 and 38.3 in 2012 to 58.38 in 2016-17. This phenomenon is particularly pronounced within Afghanistan's Kuchi and rural populations. The poverty rate stands at 77.72% among Nomads and 67.19% among rural inhabitants, contrasting with a lower incidence in urban settings. Moreover, some provinces exhibit rural household poverty levels exceeding 80%.

In the context of diverse factors contributing to Afghanistan's rising poverty rates, this paper seeks to assess whether embracing livelihood and crop diversification could positively affect rural poverty alleviation. Empirical findings underscore the substantial impact of income diversification on poverty reduction, while crop diversification does not show a significant impact. The Logit model demonstrates a robust, inverse relation between poverty levels and the diversification of livelihood. As diversification increases, rural household poverty levels demonstrably decrease. To assess the robustness of our results, we constructed an Index of Multidimensional poverty and a Non-food to total expenditure ratio as well. We assessed the impact of livelihood and crop diversification on MPI and Non-food expenditure with a linear and Tobit regression respectively. Tobit regression results show that an increase in Livelihood diversification is linked with an increase in non-food expenditure and therefore with the welfare of rural households. Linear regression confirms that livelihood diversification has positive implications for reducing multidimensional poverty.

Our results also show that other variables such as household size, age of the head of household, marital status of the head (engaged and never married), higher education of the members, land ownership, total income from the most important activity, insecurity perception, landscape characteristic of being in a valley or hill, the distance of more than 6 hours and a daily wage of skilled labor determine and influence poverty level among rural households.

The findings provide valuable insights for policymakers to take appropriate policy measures to improve families' income and reduce poverty among rural households.

Keywords: Livelihood Diversification, Crop Diversification, Rural poverty, Logit model, Afghanistan

Panel ECON01
Environments, Economics and Livelihoods in Central Asia
  Session 1 Thursday 6 June, 2024, -