Rural Livelihood Diversification in Nigeria: Implications for Labour Supply and Income Generation

Abstract

This study assessed how rural households in Nigeria diversify their livelihoods, using data from the 2015/16 Nigeria General Household Survey. The degree of livelihood diversification was measured using the Simpsons Index of Diversity (SID), and the income shares obtained by the households from their livelihoods was estimated using the mean of income shares approach. Empirical findings of this study indicates that livelihood diversification is becoming the norm among rural households. Although there is a higher labour supply in the agricultural sector, but the households earn a lower mean income from agriculture, and a low share of farm income relative to off-farm income. This suggests that subsistence mode of farming prevails and rural households in Nigeria earn more income from off-farm than from farm livelihoods.