Abstract:
In Ethiopia, agriculture is traditionally viewed as a crucial strategy for reducing poverty and im-
proving food security among rural households. However, despite the significant role of crop and
livestock production, Ethiopia remains highly food-insecure and prone to famine. Livelihood diver-
sification beyond agriculture is underemphasized by local communities, contributing less than 17%
to the economy, despite its potential to improve rural households’ food security. The research aims
to identify key livelihood diversification strategies, evaluate the extent of diversification, explore its
determinants, and analyze its impact on food security. Multi-stage sampling was used to purposively
select Agarfa district and then 384 sample households out of four rural kebeles both by systematic
random sampling techniques. Utilizing a mixed-methods design, the study employed a cross-sec-
tional survey combining quantitative and qualitative data collection techniques. Data were gathered
through semi-structured questionnaires, household dietary diversity scores questionnaire, focus
group discussions, key informant interviews, and field observations. Descriptive statistics were ap-
plied alongside inferential methods such as t-tests, Chi-square tests, and ANOVA. Econometric mod-
els, including Multinomial Logit (Mlogit) and Propensity Score Matching (PSM) were also utilized.
HDDS employed to measure households’ food security status. Qualitative data were analyzed
through narration, conceptual generalization, and summarization. Findings reveal that rural house-
holds engage in a variety of livelihood strategies beyond agriculture, such as off-farm, non-farm to
achieve livelihood goals. However, agriculture remains the primary source of income, dominating
over 83% of total income. The average Shannon Entropy Index (SEI) of 0.77 indicates a low level
of diversification. Household dietary diversity averages 5.63 food groups, with 14.84% of house-
holds classified as having low food security, while 54.95% have medium, and 30.21% enjoy high
food security. The propensity score matching model result shows, livelihood diversification posi-
tively influences food security, which increased HDDS by 10.02% up to 14.05% for diversified
households. The multinomial logit model result depicts that factor such as household head educa-
tion, family size, and access to credit drive diversification, while age, dependency ratio, livestock
ownership, farm size, and market distance are constraints. The results highlight that diversified
income sources can buffer against agricultural shocks and enhance food security, underscoring the
need for policies that support livelihood diversification in rural Ethiopia.
