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Rural Livelihood Diversification Strategies and Household Welfare in Bhutan

Author

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  • Dil Bahadur Rahut

    (International Maize and Wheat Improvement Center (CIMMYT))

  • Khondoker Abdul Mottaleb

    (International Maize and Wheat Improvement Center (CIMMYT))

  • Akhter Ali

    (International Maize and Wheat Improvement Center (CIMMYT))

Abstract

This paper analyzes rural livelihood diversification strategies and their impact on household welfare using the Bhutan Living Standard Survey 2012. The multinomial estimation shows that education, asset endowment, labor availability, and sex (male/female) of the household head play a vital role in livelihood diversification into non-agricultural sectors. Propensity score matching estimates illustrate that rural households diversifying outside agriculture have higher income and lower poverty levels compared to households pursuing only farming for their livelihoods. Livelihood diversification into non-farm activities can help reduce poverty levels in the range of 6–9 per cent, suggesting the importance of livelihood diversification in reducing poverty and increasing household income in Bhutan.

Suggested Citation

  • Dil Bahadur Rahut & Khondoker Abdul Mottaleb & Akhter Ali, 2018. "Rural Livelihood Diversification Strategies and Household Welfare in Bhutan," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 30(4), pages 718-748, September.
    • Handle: RePEc:pal:eurjdr:v:30:y:2018:i:4:d:10.1057_s41287-017-0120-5
    DOI: 10.1057/s41287-017-0120-5
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    Cited by:

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    2. Mirosław Biczkowski & Aleksandra Jezierska-Thöle & Roman Rudnicki, 2021. "The Impact of RDP Measures on the Diversification of Agriculture and Rural Development—Seeking Additional Livelihoods: The Case of Poland," Agriculture, MDPI, vol. 11(3), pages 1-26, March.
    3. Yibin Ao & Ling Tan & Qiqi Feng & Liyao Tan & Hongfu Li & Yan Wang & Tong Wang & Yunfeng Chen, 2022. "Livelihood Capital Effects on Famers’ Strategy Choices in Flood-Prone Areas—A Study in Rural China," IJERPH, MDPI, vol. 19(12), pages 1-19, June.
    4. Helmy, Imane, 2020. "Livelihood Diversification Strategies: Resisting Vulnerability in Egypt," GLO Discussion Paper Series 441, Global Labor Organization (GLO).
    5. Sarker, Md Nazirul Islam & Wu, Min & Alam, GM Monirul & Shouse, Roger C, 2020. "Livelihood diversification in rural Bangladesh: Patterns and determinants in disaster prone riverine islands," Land Use Policy, Elsevier, vol. 96(C).
    6. Manyu Wang & Min Li & Bei Jin & Lan Yao & Hao Ji, 2021. "Does Livelihood Capital Influence the Livelihood Strategy of Herdsmen? Evidence from Western China," Land, MDPI, vol. 10(7), pages 1-22, July.

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    More about this item

    Keywords

    rural livelihood; poverty; income; propensity score matching; Bhutan;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • D10 - Microeconomics - - Household Behavior - - - General
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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