Humboldt-Universität zu Berlin - Quarterly Journal of International Agriculture

Quarterly Journal of International Agriculture No. 1/05

Non-farm rural employment –
review of issues, evidence and policies

Gertrud Buchenrieder
University of Hohenheim, Stuttgart, Germany


Evidence from most continents over the last decade shows that the share of rural household income from non-farm sources is growing in the process of rural development. Recent empirical research found that non-farm sources account for 40-45% of average rural household income in sub-Saharan Africa and Latin America, 30-40% in South Asia, and 30-50% in Central and Eastern Europe. Most of this income originates from local rural sources rather than urban migration. Thus, non-farm rural employment (NFRE) is gaining prominence in debates on rural development. The term NFRE is used to mean any non-farm employment by a rural household, including urban jobs and remittances. Hence, it is related to employment, income and livelihoods not directly derived from crop and livestock production.

This contribution aims at giving an overview of the research issues on NFRE, its findings and policy recommendations as it concerns rural poverty reduction. The policy recommendations identified are embedded in the sustainable livelihood framework as it can serve as a guideline to explain why some farm households tend to specialize in agriculture and others to diversify their activities. It can further be used to analyze the factors determining demand-pull and distress-push diversification.

Keywords: non-farm rural employment, diversification, livelihood, equity

Vol. 44 (2005), No. 1: 3-18