Determinants of on-farm diversification in Bangladesh

Abstract

On-farm diversification has the potential to reduce income variability, raise revenues, and increase food security in Bangladesh. This study identifies determinants of on-farm diversification using the Agricultural Household Model (AHM) as the theoretical framework. Survey data collected in Bangladesh over June-September 2014 were empirically examined. The Probit model was used to analyse the impact upon on-farm diversification of different household, farm and market characteristics. Data show that the age of the head of the household, farm size, access to credit, technical assistance, regional dummies and access to markets positively influenced the adoption of on-farm diversification. The active participation of women in farming activities was a noteworthy determinant that was found to increase diversification in Bangladesh. The key implication is that addressing these factors in the national agricultural policy of Bangladesh will encourage Bangladeshi farmers to diversify their farming activities. Recommendations for policy guidelines are proposed for consideration.