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Abstract
This study empirically investigates the effect of the productive safety net programme (PSNP) on household food consumption and dietary diversity in Ethiopia. The study applied random effects with instrumental variables to estimate the effect of PSNP membership. The results of the study indicate that, although PSNP membership improves household food consumption, it reduces the household dietary diversity score. Household food consumption and dietary diversity are also significantly influenced by sex, age, education status of household head, household size, livestock ownership, distance to the nearest market and participation in non-farm activities. The findings of this study suggest that PSNP membership should be reinforced by building household awareness of the benefits of consuming a variety of foods. In addition, PSNP membership should be designed to endow the households to accumulate essential assets, especially livestock.