To Specialize or Diversify: Agricultural Diversity and Poverty Persistence in Ethiopia

This article answers the empirical question: what is the relationship between the choice to specialize or diversify in crop production and household poverty status? We use household panel data from Ethiopia and a recently developed parametric method for estimating dynamic binary response models with endogenous contemporaneous regres- sors. Our results provide evidence that households which grow a diverse set of crops are less likely to be poor. Additionally, crop diversity reduces the probability that a house- hold will fall into poverty and reduces the probability that a household will remain in poverty. We conclude that policies which encourage households to specialize in cash crops may be counter-productive while policies which encourage crop diversification may reduce poverty.

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 Record created 2017-04-01, last modified 2018-01-23

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