Review on the Determinants of Agricultural Productivity and Rural Household Income in Ethiopia

Achieving agricultural productivity growth will not be possible without developing and disseminating improved agricultural technologies that can increase productivity to smallholder agriculture farm. It is significantly important to identify the factors that affect agricultural productivity and find the methods of the rural household income improvements. Therefore, the objective of this article is to review and summarize the different factors that affects agricultural productivity and rural household income in Ethiopia based on studies conducted by different scholars so far. Land-labor ratio, use of fertilizer, use of extension service, use of pesticide, manure, number of oxen used and household size are found to be the most significant variables that affect agricultural labor and land productivity. However, drought has statistically significant and has negative effect on both labor and land productivity by the same magnitude. Labor productivity, non-farm income and land productivity are found to be the most determinants of household income. However, number of dependency ratio is significantly and negatively affecting the rural household income. Sex of the household head is the main socio-economic factor for the variation of income among the rural households. The review also concludes that, Labor productivity is the most potent for factor of production and rural household income enhancement. Then increasing land-labor ratio is important for agricultural productivity enhancement and promotion of both farm labor and non-farm income are best focusing to speed up for the enhancement of rural household income. Keywords : labor productivity; land productivity, rural household income DOI: 10.7176/JESD/11-18-01 Publication date: September 30 th 2020