Determinants of smallholder commercialization of livestock: A case study from Tigray, Ethiopia

Abstract

In several developing countries, including Ethiopia, the change from a subsistence-oriented production system to a market-oriented production system as a means of raising smallholder incomes and mitigating growing rural deprivation has been at the center of the agenda. Therefore, the purpose of this analysis was to evaluate the determinants of smallholder livestock commercialization in Tigray, Ethiopia. One hundred and eighty-three households were selected using a simple random sampling technique. The data were gathered through a structured survey. The data obtained were evaluated using econometric models of both concise and Heckman two-step collections. The results of the binary probit model revealed that in the decision to sell, household head education level, family size, distance from the nearest market center, and the total livestock ownership played a significant role. Heckman second-step selection estimation indicated that the education level of the household head, the extension agents’ visit, the total livestock owned and the owned land size significantly affected the level of commercialization measures. The findings of this study will contribute to enhancing the efficient utilization of the existing limited farmland. In this study, smallholder farmers’ access to the agricultural markets with higher value is seen as a critical opportunity to improve and diversify the livelihoods of lower-income farm households. As a result, better market participation is required to connect smallholder farmers to markets and increase demand for livestock products and income generation. The findings of this study may help in the development of appropriate policy intervention mechanisms to promote smallholder livestock commercialization in Ethiopia.

Keywords

• subsistence-oriented production
• two-step heckman pattern
• binary probit model
• rural communities
• level of commercialization