INFLUENCE OF PARTICIPATION IN NON-FARM ACTIVITIES ON LIVING STANDARDS OF RURAL HOUSEHOLDS IN CHEBORGE DIVISION, KERICHO COUNTY, KENYA

ABSTRACT
The number of people living below the poverty line in Kenya has continued to increase. This is attributable, among other things, to the declining agricultural output due to the rapidly changing climatic conditions and small farm sizes. Rural households have, therefore, diversified their income sources by participating in non-farm activities alongside small-scale agricultural activities (multiple job holding) to get basic needs. However, there is the question as to whether policy should focus more on agricultural activities or on non-farm activities. The key variables studied include non-farm activities levels of participation and living standards. The aim of this study was to determine the influence of participation in non-farm activities on living standards of rural households in Cheborge Division of Kericho County. The study was guided by the Sustainable Livelihood Framework. Cross-sectional survey was adopted. From a population of 5235 households, a sample size of 192 households was selected proportionately using stratified and convenient sampling. An interview schedule was used to collect data from household heads. Content and face validity was done by subjecting the interview schedule to experts from the Department of Applied Community Development Studies and the Faculty of Education and Community Studies. A reliability coefficient of 0.728 was obtained using Cronbach’s alpha. Percentages were used to describe the living standards and the non-farm activities that households participate in. The Statistical Package for Social Science (SPSS) was used to compute the data. The t-test and chi-square tests were used to test the hypotheses at α = 0.05. The findings show that majority (88%) of households were pushed into non-farm activities while only 12 percent were influenced by pull factors. Trading activities constituted the largest percentage of 52.3% with majority of households having a medium living standard. Findings show that 47.8% of households had low levels of participation while only 21.7% had moderate level of participation in non-farm activities. The χ2 value of 1.747 is significant at =0.05 (P>0.05). Therefore, there was no significant relationship between levels of participation in NFAs and living standards. The calculated mean of living standards of households that participated in NFAs is 13.5 while that for households not participating was 12.98. The living standards of households that participated in NFAs were significantly higher than that of households that did not participate in non-farm activities. The study recommends that policy

CHAPTER ONE
INTRODUCTION
Background of the Study
Despite the rapid process of urbanization observed in most developing and transition countries, poverty still remains a predominantly rural phenomenon (Carletto et al. 2007). The majority of Sub-Saharan Africa’s population lives in rural areas, where poverty and deprivation are most severe (Diao et al, 2007). Poverty in its various forms has increasingly occupied the attention of the international community during the last decade. Successive Summits have made commitments to reduce drastically the misery from which so many humans suffer throughout their lives. However, extreme poverty remains an alarming problem in the world's developing regions, despite the advances made in the 1990s (FAO, 2006).

In Kenya, high incidence of poverty coupled with stagnating or declining income growth are the two major challenges facing the country today. Close to 46 percent of the total population and nearly half of the rural population live below the poverty line defined as those living under 1 US Dollar per day. These meager incomes are incapable of sustaining any meaningful livelihood (Republic of Kenya, 2007). Increasing numbers of people are unable to access basic social necessities like health, education, clean water and housing due to this.

About 67% of Kenya’s population lives in the rural areas and largely derive their livelihood from agriculture (Government of Kenya, 2009). This scenario has not only revived poverty reduction as a central development theme, it has further challenged policy makers to re-assess the viability of intervention points. This has left many questions as to the best strategies that should be used to deal with the problem, spurring numerous research interests and massive donor funds to be used. The fight against poverty, however, remains an elusive goal. Rising poverty levels have prompted the international community to develop and seek consensus on internationally agreed development goals to be pursued by governments. This led to the adoption of the International Development Goals and consequently the United Nations endorsed Millennium Development Goals (MDGs). At the same time, multilateral lending agencies also developed their own version of development goals that focus on poverty alleviation strategies like the Poverty Reduction Strategy Papers (PRSPs) (GOK, 2005). However, these policies have not clearly addressed the contribution of non-farm activities. This study may be necessary in the design of appropriate poverty reduction strategies.

Agriculture has been the focus of poverty reduction strategies in the rural areas of Kenya where the majority of the population resides (GOK, 2002). However, rapid population growth and sub- division of land along inheritance lines has resulted in very small farm sizes. Furthermore, in densely populated regions, there is now major concern that land may have become too small to make any meaningful contribution to household incomes (Marenya, Oluoch-Kosura, Place & Barrett, 2003). This land scarcity suggests that agricultural activities may not remain the only or even the main source of income and therefore rural households may not climb out of poverty through growth in land productivity alone. Rural households engage in non-farm activities as a way of diversifying their income sources.

There has been an outstanding trend of income diversification in rural areas in developing countries such as Kenya (Demurger, Fournier & Yang, 2010). Rural non-farm earnings accounts for 30% to 45% of rural household income across the developing world (Haggblade, 2005). Income diversification across the developing world has pointed to the increasing role of non- farm incomes in poverty reduction which is found to have an important impact on income, income distribution and welfare across rural households (Block & Webb, 2001). Non-farm activities in rural areas seem to offer a promising solution to many problems by creating local employment opportunities and generating new sources of income for investment (Wang et al. 2011). Income diversification can be considered as an important way to increase overall rural economic activity and employment in many developing countries like Kenya. This also helps in reducing the pressure on the demand for land in rural areas (Bryceson, 1996). Earnings from non-farm activities cannot only significantly increase total household income, but also function as a safety net through diversifying income sources.

Non-farm activities play an increasingly important role in sustainable development and poverty reduction in rural areas of Kenya. The non-farm sector particularly in rural areas has been accorded wide recognition in recent years as a potent instrument for alleviating rural poverty and providing employment opportunities (Sharad, 2006). Therefore, exploiting these non-farm opportunities could offer a pathway for improving the living standards of the rural poor (Barrett, Reardon & Webb 2001; Food and Agricultural Organization, 1998). Non-farm activities (NFAs) are viewed as containing the mechanisms for achieving several objectives, all of which are integral to the process of rural development: alleviating poverty, reducing rural income inequality, increasing employment, slowing down rural-urban migration, reviving traditional crafts and building small scale industries using local resources (Wegulo, 1997). There are questions as to whether policy should focus more on investments in current portfolio of land based activities such as investments in fertilizers and modern seed or on human capital investments that may expand non-farm earnings. These include entrepreneurial training programs or vocational training, greater access to primary and secondary education and improved health care. However, for this to happen, the domestic environment also needs to improve.

In Kenya and especially in Cheborge, there remains an urgent need to develop appropriate policies, adopt or scale up successful approaches, and invest more and better in non-farm activities in rural areas. This study therefore seeks to provide an understanding of the types of non-farm activities in which rural households engage in to generate incomes and how participation in those activities influences the living standards of rural households in Cheborgei Division.

Statement of the Problem
Rural households in many developing countries largely obtain their income from agriculture. However, in many rural areas rapid population growth and sub-division of land along inheritance lines has resulted in very small farm sizes. Over the years, policy makers have put more emphasis on agricultural production. Households in Cheborge Division depend on farm activities but this alone cannot sufficiently satisfy their income needs. Rural households are, therefore, involved in non-farm activities as a way of increasing their income. There are questions as to whether policy should focus more on investments in current portfolio of land based activities such as investments in fertilizers and modern seed or on human capital investments that may expand non-farm earnings. Policies in Kenya should also focus on the possible contribution of non-farm activities rather than only on small-scale agricultural production. It is therefore important to understand the contribution of incomes from rural non-farm activities and how this influences the living standards of rural households. This is because it is not clear whether the standard of living among Kenyans living in the rural areas such as Cheborge Division has been changed by indulgence in NFAs. Rural development policies in Kenya needs to be based on a good understanding of the types of Non Farm Activities (NFAs), factors motivating household participation in NFAs the levels of participation of households in NFAs as well as influence of participation in NFAs on living standards of rural households in rural areas thus the focus of this study.

Purpose of the Study
This study was designed to determine the influence of participation in non-farm activities on living standards of rural households in Cheborge Division of Kericho County, Kenya.

Objectives of the Study
These were objectives of the study:

i. To determine factors that motivate rural households to participate in non-farm activities in Cheborge Division.

ii. To determine the types of non-farm activities that rural households in Cheborge Division engage in.

iii. To determine the levels of participation of households in non-farm activities in Cheborge Division.

iv. To determine the living standards of households in Cheborge Division.

v. To determine the relationship between levels of participation of households in non-farm activities and living standards of households in Cheborge Division.

vi. To identify the differences in the living standards of rural households that participate and those that do not participate in non-farm activities in Cheborge Division.

Research Questions
i. What are the factors that motivate rural households to participate in non-farm activities in Cheborge Division?

ii. What are the types of non-farm activities that rural households in Cheborge Division participate in?

iii. What are the levels of participation of households in non-farm activities in Cheborge Division?

iv. What is the living standards of households in Cheborge Division?

Research Hypotheses
Objectives five and six were hypothesised as follows:

H01: There is no statistically significant relationship between the levels of participation of rural households in non-farm activities and living standards in Cheborge Division.

H02: There is no statistically significant difference between the living standards of rural households that participate and those that do not participate in non-farm activities in Cheborge Division

Significance of Study
In spite of mounting evidence on importance of non-farm sector to farm households, there has been little systematic study of the rural non-farm activities and their contribution to the income of rural households. Policy-makers are looking to the wider rural economy, to reduce persistent rural poverty and stem rural-urban migration. This study was designed to determine the nature and influence of rural household participation in non-farm activities on living standards. The findings of the study may sensitize policy makers in the government, donor and development agencies on the role of non-farm income generating activities in influencing the living standards of the rural households. This study is important because it may consequently serve to further the harmonious growth of both farm and non-farm activities among rural households. The findings may also sensitise rural household heads in choosing whether to diversify their income sources through non-farm activities or not.

Scope of the Study
The study focused on non-farm activities such as agro-processing, trading, artisan, extractive and service provision among small-scale farmers. Wages from formal employment were excluded.

The study was conducted in six locations in Cheborge Division namely Cheboin, Kapsogut, Cheborge, Kibugat, Tebesonik and Techoget.

Limitations of the Study
There were problems of illiteracy but the researcher translated the questions on the interview schedule into Kipsigis language. There was also difficulty locating the household heads for the interview because majority of them were working outside their farms. To overcome this, the researcher made appointments and went repeatedly until the required household heads were interviewed.

Assumptions of the Study
The study made an assumption that household heads were willing to adequately avail information regarding their households.

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