The study evaluated impact of non-farm activities on wellbeing of rural household using cross-sectional data.Household's consumption expenditure per adult equivalent was analyzed to measure household wellbeing. Multi-stage sampling technique was employed to select sample households from three Kebeles. Both primary and secondary data were used. Data were collected primarily through Semi-structured survey questionnaire from 178 households. Descriptive statistics and propensity score matching model were used to analyze the data. Propensity score matching (PSM) technique of impact evaluation preferred to overcome counterfactual problem and selection bias. Analysis results show that non-farm activities have increased consumption expenditure per adult equivalent ranging from 29.1% to 36.7% for participant households. In conclusion, participant households were more likely to be wellbeing as compared to the non-participant households. The result from the logistic estimator also revealed that participation in non-farm activities was significantly associated with variables such as age, education, adult equivalent size, cultivable land size, farm experience, and distance from main road, tropical livestock unit and access to nonfarm training. Therefore, such rural development planners and other stakeholders should consider the roles of these variables within the selection of participants for desired impact on economic wellbeing.

This study analyzed the determinant of rural household participation in non-farm and level of generated household income from the activities in Haramaya district, Ethiopia using cross-section data. During this study both primary and secondary data were employed Primary data were collected from 196 sample respondents using stratified random sampling. In this study both descriptive and econometric analysis was carried out. Descriptive statistics were applied to characterize the sample households in terms of economic, demographic and institutional factors. Heckman two stages selection model was used for estimation of determinant participation of rural households in non-farm activities and determinant level of income from non-farm activities. The result of factors affecting participation of rural households in non-farm activities indicated landholding size, use of irrigation, livestock holding and distance to nearest market negatively and significantly influenced participation while education, household size and non-farm training significant and positively affects participation of rural household in nonfarm activities. In the result of determinant level of non-farm income shows that landholding size, use of irrigation, livestock holding and distance to the nearest market were significant and negatively affects level of non-farm income while household size and education status were significant and positively influenced level of non-farm income. In generally the study identified the determinant of rural household participation in non-farm activities and determinant level of income from non-farm activities. Therefore, Policy makers should integrate the promotion of non-farm activities in the framework of rural development policies and strategies.