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RURAL LABOUR DISPLACEMENT AND CLIMATE VARIABILITY IN CENTRAL ETHIOPIA: PANEL DATA APPROACH [Abstract ID: 0308-03]
Unbalanced panel data (1994-2014) collected from the central highlands and Arssi grain plough farming systems of Ethiopia were used to examine the effect of climate variability on rural labour displacement. The result of instrumental random effect two-stage least squares regression revealed that increments in crop income significantly reduced rural labour displacement from the study area. This significant interaction implies that factors relating to climate variability, which have a negative effect on crop income, strongly affected rural labour displacement. The model result also showed that the possession of large livestock, which is the main source of labour, food and cash, has a significant effect in reducing labour displacement from the two farming systems. Household participation in off-farm activities would reduce displacement from their home location, according to the results of the model. Factors including crop season rainfall, disease and pest outbreaks, and shocks caused by climate variability, were significant causes of displacement by household members. This study therefore recommends that policies and programs should focus on creating stable income sources and sustainable water availability for smallholder agriculture in order to reduce rural labour displacement from the two farming systems.