M.Sc. Dissertation
Although, agriculture remains the main source of income and employment in developing
countries, it is a universally accepted fact that agricultural sector is incapable of creating
sufficient income in the middle of increasing population. Thus, the non-farm sector is
increasingly becoming important. Generally, the study assessed the effects of non-farm
activities to household income in purposefully selected rapidly urbanizing villages in
Mufindi District, namely; Nyololo Shuleni, Lugema, Igowole and Kiyowela, whereby,
the sample of 223 farmers was involved. The study specifically identified the non-farm
activities in the study area; determined the factors that influence farmers to participate in
non-farm activities in the rapidly urbanizing villages, and examined the effects of non-
farm activities on income of the farmers in those villages. Descriptive statistics were
used to identify non-farm activities in the study area and obtain general characteristics of
the study population. Probit model was used to capture the influence of determinants of
non-farm activities participation by farmers and results indicated that sex, age, and
education level of farmers were statistically significant while farm size owned and farm
size cultivated were not. Propensity Score Matching was used to determine the effect of
non-farm activities on the income of farmers in urbanizing villages and the findings
show that the difference in incomes between farmers with non-farm activities and those
without was statistically significant. It can be concluded that, non-farm activities served
as the potential alternative source of income to farmers which will enable them to secure
more necessities for their better living. Therefore, it is recommended that, to improve
household income, the government should improve the quality of education offered by
introducing agricultural and entrepreneurial courses in elementary schools and make
them core courses to increase awareness of importance of various activities. In addition,
subsidizing agricultural inputs, but also improving infrastructure facilities such roads,
will be a good move to non-farm activities in improving people‟s income.