Migration and Household Income Diversification; the Case of Setama Woreda, Jimma Zone in Oromia Region

Abstract

This paper intended to study the impact of migration on household income diversification in Setema Woreda of Jimma Zone, Oromia Regional State. This paper uses limited-dependent variable methods and new data from Setema district to test the effect of intercontinental on activity choice and incomes in rural households. Econometric evidence assists our theoretical expectation that the impact of emigration varies both by migrant destination and production human activity. We find no evidence of either positive or negative effects of continental migration on any activity because all migrants are intercontinental migrants. However, intercontinental migration, which tends to be long-term and generates significantly larger remittances, stimulates livestock production and cash crop know negatively associated with non farm activities income and positively associated with crop production but not significant. the policy recommendation is very important to continue the effect of migrants on financial gain diversification i.e. on livestock and cash crop production promotion of production working on infrastructure and search of groundwater for irrigation is most policy recommended to the district. The result of this study is expected to shed light on the current literature gap in the study area.