Quantifying rural livelihood strategies in developing countries using an activity choice approach

Abstract

This article uses a quantitative activity choice approach, based on identification of activity variables and application of latent class cluster analysis, to identify five major rural livelihood strategies pursued by households (n= 576) in Bolivia, Nepal, and Mozambique. Income sources and welfare outcomes are compared across strategies and household differences in asset holdings are analyzed using multinomial logit regression. Findings reveal that income diversification is the norm, that a higher degree of specialization does not characterize more remunerative livelihood strategies, that nonfarm income significantly contributes to higher income earnings, that environmental reliance does not vary across strategies, and that small‐scale farmers are the largest and poorest livelihood group. Some livelihood strategies are superior to all other strategies in terms of income earned; access to more remunerative livelihood strategies is determined by land ownership, education, and ethnic affiliation. Finally, the article also highlights that additional work is required to determine the most suitable methods for livelihood strategy identification.

Classification of the Relationship between Household Welfare and Ecosystem Reliance in the Miyun Reservoir Watershed, China

“…The results fully demonstrated the diversity of the relationships between humans and nature. This was confirmed by some researches on rural livelihood [22,48,49].…”

Rural livelihoods and environmental resource dependence in Cambodia

“…The most important issue to consider when differentiating households into distinct livelihood strategies is the group of factors (variables) that could be used to separate or discriminate between households. One of the most popular approaches in the literature is the application of a cluster analysis (Barrett et al, 2001) using either the income shares from different sources or the household's assets and activities pursued to make a living (Nielsen et al, 2013). The income share method has been long advocated given that income is an important factor which is directly comparable, making the method straightforward in its interpretation and use in quantitative analysis (Soltani et al, 2012).…”

“…This method requires gathering data on household asset endowment and incomegenerating activities using household surveys (Brown et al, 2006). A household can allocate its assets to different activities in order to generate outcome portfolios such as consumption, food security, and investment spending (Nielsen et al, 2013). Since households use different assets to sustain their livelihoods, the variables used to measure the allocation of household capital (e.g.…”

“…These initiatives need to be adapted to the livelihoods of the targeted communities and individuals (Nielsen et al, 2013). Even though rural households in developing countries pursue a wide range of livelihood activities (Babulo et al, 2008), there is a common notion that there exist, to some degree, distinct livelihood strategies across rural households (van de Berg, 2010).…”

Effects of New Roads on Environmental Resource Use in the Central Himalaya

“…Rural household incomes in developing countries derive from diverse activities [1][2][3][4], typically in response to variations in household member skills, the seasonality of employment opportunities and food production systems, shocks and spatially in relation to market access [1,3]. Recently, the economic importance of income (absolute and relative) from forests and other non-cultivated environments-such as grasslands, fallows, rivers and swamps-to rural households has been demonstrated across a range of developing countries and settings (e.g., [4][5][6][7][8]).…”