Decent rural employment and farm production efficiency: empirical evidence from Tanzania and Ethiopia

Promoting decent rural employment, by creating new jobs in rural areas and upgrading the existing ones, could be one of the most efficient pathways to reduce rural poverty. This article systematically investigates the impact of decent rural employment on agricultural production efficiency in Ethiopia and Tanzania. The analysis applies an output-oriented distance function approach with an estimation procedure that accounts for different technological, demographic, socioeconomic, institutional, and decent rural employment indicators. Data of the 2011 round of Living Standards Measurement Study-Integrated Surveys on Agriculture for the two countries are used, and a set of indicators is derived to proxy core dimensions of decent rural employment. The findings of our analysis show that decent rural employment contributes to agricultural production efficiency.