Determinants of Farm and Non-Farm Activities as Sources of Income amongst Rural Households: Evidence from Kahama District in Tanzania.

Abstract

The paper has been set to determine the factors influencing  farm and non-farm activities as sources of household income in Kahama District in Tanzania. Two villages (Bunasani and Kinamapula villages) of Kahama district were sampled for the study and a sample of 207 farmers had been drawn randomly from the population. A double-censored regression model, in particular a two-limit tobit model was applied to analyze the determinants of income share from farm and non-farm income sources among the households. Results reveled that, farm size increases, the share of income from farm income source would also increase. However, the marginal effect for farm size is 4.16 which is significant at 1% level of significance. Male-headed households derive a large share of their income from farming activities as compared to female-headed households where the marginal effects are about 3.5 percentage points. To promote the farm and non-farm sector income and strengthening its potential linkages between them, the study mainly recommends increasing efforts on two fronts: first, reforming the institutions responsible for rural development and second, development activities and projects that would enhance farm and non-farm income and the linkages between them.

Keywords: Determinants, Income, Farm, Non-Farm, Household