Department of Economics

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A Thesis on The Role of Microfinance Institutions in Youth Economic Empowerment in Shire Town, Tigray, Ethiopia:
(Mekelle University, 2025-11-25) Fisseha Gebremedhin
Youth unemployment remains a pressing challenge in Ethiopia, particularly in post-conflict regions such as Shire Town, where economic disruption has constrained livelihood opportunities. The main objective is to evaluate how participation in MFIs affects youth income and to identify the institutional and demographic determinants influencing microfinance participation. The study employs a cross-sectional survey of 270 youth respondents, combining descriptive statistics with an Endogenous Switching Regression (ESR) model to correct for self-selection bias. Descriptive results reveal that the average respondent is 25 years old, with a mean family size of four and an average education level of five years. Males constitute 79% of the respondents, and 50% are microfinance participants. Approximately 63% of married youths and 49% of house owners are MFI participants, indicating that gender, marital stability, and asset ownership are major factors associated with financial inclusion. The mean natural logarithm of income corresponds to an approximate monthly income of ETB 68,000, suggesting considerable income variation among youth. The ESR model results confirm that microfinance participation significantly improves youth income, validating its role in economic empowerment. In the selection equation, sex, age, marital status, family size, and asset ownership significantly influence participation decisions. Male and older youths are more likely to participate, whereas larger family sizes decrease participation probability. For microfinance participants (Regime 1), income is positively affected by age and house ownership but negatively influenced by gender (female), marital status, and family size. Among non-participants (Regime 0), distance to market and house ownership remain key income determinants. The high positive correlation coefficient (ρ₁ = 0.963, p < 0.01) between the error terms of the selection and income equations confirms the presence of positive selection bias, indicating that youths inclined to participate in MFIs inherently have higher income potential. The results demonstrate that microfinance access enhances youth income and self-employment opportunities, consistent with prior empirical evidence. However, persistent gender disparities in income returns suggest that female participants face structural and institutional barriers even after gaining access to credit. Furthermore, the significance of asset and house ownership in both regimes underscores the importance of collateral and stability in fostering financial inclusion. In conclusion, microfinance institutions play a pivotal role in improving youth livelihoods in Shire Town by enhancing income, promoting self-employment, and strengthening asset accumulation. Strengthening institutional capacity and aligning microfinance services with youth development policies was crucial tosustaining empowerment outcomes and fostering inclusive post-conflict recovery in Tigray.
A Thesis Submitted in Partial Fulfillment of the Master's Degree in Economics, Development Policy Analysis Specializations
(Mekelle University, 2025-11-25) ENDRYAS TSEGAY BERHE
Urban poverty remains a significant challenge in Ethiopia, particularly in medium-sized towns like Kolla-Tembien Wereda, despite national economic progress. This study investigates the incidence, depth, determinants, and coping strategies of urban poverty in this context, where rising living costs, limited employment, and inadequate institutional support persist. The research aims to identify key poverty determinants and assess survival mechanisms of poor households. A cross-sectional survey was conducted with 300 randomly selected household heads across six kebeles in Kolla-Tembien Wereda, using a structured questionnaire to collect data on demographics, income, expenditure, education, employment, access to services, and coping strategies. Descriptive statistics revealed that 62% of households fell below the local poverty line, with an average household size of 5.3 persons and low educational attainment (primarily primary school). Most households relied on informal employment, such as daily labor and petty trade, while having limited access to stable jobs and basic services like water, electricity, and healthcare. A binary logit model identified education, family size, gender, access to credit, and non-farm activities as significant determinants of poverty. Higher education and access to credit reduced poverty likelihood, while larger families and female-headed households faced greater vulnerability due to higher dependency and unequal opportunities. Coping mechanisms included informal borrowing, reducing food consumption, renting dwellings, selling assets, and participating in group solidarity schemes like “Idir” and “Iqub.” Some households limited children’s schooling or delayed healthcare, often increasing long-term vulnerability. These findings highlight the multidimensional nature of urban poverty, driven by structural, demographic, and institutional factors. The study recommends strengthening local credit institutions, promoting skill development, and improving urban infrastructure to address poverty’s root causes. This research provides empirical evidence to inform municipal povertyreduction policies and livelihood programs in Ethiopia’s medium-sized towns.
Adoption of Modern Agricultural Technologies in Urban Agriculture: A Case Study in Abiy-Adi town -Vegetable Growers
(Mekelle University, 2025-10-23) Teame Gebreyosus
Modern agricultural technology plays a vital role in enhancing farmers' productivity and promoting sustainable farming practices. This study investigates the determinants influencing the adoption of fertilizer and pesticide in urban agricultural farming. A total of 240 respondents were surveyed using both primary and secondary data sources. The collected data were analyzed through descriptive statistics and Econometric models. Specifically, a Logit model was employed to identify the determinants of adoption, while propensity score matching (PSM) was used to assess the impact of adoption on household income. The results reveal that age, gender, farming experience, attitude, perception of cost toward modern technology, extension support, use of organic manure, and scarcity of irrigation water are significant factors affecting adoption decisions. Among these, age, attitude, and use of organic manure were found to have a negative relationship with adoption. Moreover, the adoption of modern agricultural technologies has a significant positive impact on farmers' income. The findings indicate that the average treatment effect (ATE) of adoption on household income is 262,519 birr, while the average treatment effect on the treated (ATT) is 61,578 birr. The higher ATE compared to the ATT suggests that non-adopters could potentially gain even more income benefits if they adopted modern agricultural technologies. This implies that adopters may not yet be fully optimizing the use of fertilizer and pesticides, possibly due to limited experience, inadequate training, or resource constraints. In contrast, non-adopters have a higher untapped potential for income improvement once barriers to adoption are addressed. To bridge this gap, policy interventions should focus on strengthening agricultural extension and capacity-building programs to ensure effective and efficient use of modern technologies. Tailored training and demonstration programs should be introduced to improve farmers' technical knowledge and management practices. Additionally, enhancing access to affordable inputs through subsidies, credit schemes, or cooperative purchasing, along with improving irrigation infrastructure, can encourage wider adoption and help farmers maximize the income potential indicated by the ATE. These measures would contribute to more equitable and sustainable income growth among urban farmers,
Cost-Effectiveness Analysis of Fertilizer Input on Sorghum Productivity in Tahtay Adyabo, northwester Tigrai
(Mekelle University, 2025-09-23) Surafeal Gerezghir
This study evaluates the cost-effectiveness of various fertilizer inputs on sorghum productivity in Sheraro, Northwestern Tigray. Sorghum (Sorghum bicolor) plays a vital role in Ethiopian agriculture, serving as a staple food and a key source of income for many households. Utilizing a mixed-methods approach, this research examines the impact of different types of fertilizers organic, inorganic, and blended on yield outcomes, economic viability, and soil health. Key findings indicate that nitrogen-based fertilizers are predominantly used among farmers, yet a significant interest in organic options is emerging. The economic analysis reveals that integrated nutrient management practices can enhance productivity while promoting sustainability. This study provides practical recommendations for farmers, aiming to improve their fertilizer use efficiency and inform agricultural policy decisions. By addressing the gaps in knowledge regarding fertilizer effectiveness and its economic implications, this research contributes to the ongoing efforts to enhance agricultural productivity and food security in Ethiopia.
DETERMINANT OF INCOME SOURCE DIVERSIFICATION AND ITS CONTRIBUTION TO LIVELIHOOD IN THE CASE OF ABIY-ADDI TOWN.
(Mekelle University, 2025-11-25) Berihu Knfe Mekenen
This study, titled “Determinants of Income Source Diversification and Its Contribution to the Livelihoods of Urban Households: The Case of Abiy-Addi Town,” examines the socioeconomic and institutional factors influencing income diversification among urban households and evaluates its contribution to livelihood enhancement. Conducted in Abiy-Addi Town, Central Zone of Tigray, Ethiopia, the research employed a cross-sectional design integrating quantitative and qualitative approaches. Data were collected from 376 randomly selected households through structured questionnaires and direct observations, supplemented by secondary information from reports and literature. Descriptive results indicated that the average household head was 46.9 years old, with a mean family size of 5.47 and an average education level of 2.7 years of schooling, reflecting low human capital. Approximately 72.6% of households participated in non-farm or off-farm income-generating activities, mainly in trade, construction, and services. However, only 48.7% had access to credit, with high interest rates and lack of collateral serving as major obstacles to diversification. The Poisson regression model identified key determinants of income diversification, revealing that education level, family size, access to credit, extension services, and training significantly and positively affected the degree of diversification. A one-year increase in education raised the likelihood of engaging in additional income-generating activities by 0.31, while access to credit increased diversification probability by 0.42. Conversely, older and female-headed households were less likely to diversify due to limited resources and cultural constraints. The model diagnostics confirmed the absence of overdispersion, validating the model’s specification. To estimate the welfare impact of diversification, Propensity Score Matching (PSM) was applied using covariates such as age, education, credit access, and training. The estimated Average Treatment Effect on the Treated (ATT) showed that diversified households earned significantly higher incomes (54,046 Birr) compared to non-diversified ones (23,649 Birr), implying that diversification nearly doubled annual income levels. Diversified households were also more food secure and less vulnerable to income shocks. These findings are consistent with Ellis (2000), Woldehanna (2000), and Fikru (2008), who underscored non-farm diversification as a key strategy for reducing poverty and improving household welfare in Ethiopia and Sub-Saharan Africa. Institutional and infrastructural challenges— including high loan interest rates, limited working premises, inadequate training centers, and poor market linkages—were found to constrain diversification. Strengthening microfinance systems, improving urban infrastructure, and expanding vocational training are therefore essential policy measures. In conclusion, the study confirms that income source diversification substantially contributes to improving urban household livelihoods in AbiyAddi Town. Promoting non-farm sectors such as small-scale manufacturing, agro-processing, and construction enhance income stability, economic resilience, and urban employment opportunities. Integrating these strategies into local development policies is crucial for achieving sustainable urban growth and poverty reduction.
Determinant of Urban Households’ Food Insecurity: The Case of Mekelle City
(Mekelle University, 2025-02-23) Getnet Ashagrie
This study seeks to analyze food insecurity issues by assessing socio-economic factors that impact the food insecurity of households in urban areas of Mekelle City. The analysis was based on survey data gathered from 397 urban households selected using a simple random sampling procedure. Primary and secondary data were used. The data regarding household determinants were analyzed using descriptive statistics and a binary logit model. The survey result showed that about 27.71% and 72.29% of sample respondents were food insecure and secure, respectively. The empirical results estimated using the survey data to identify the determinants of food insecurity among urban households in the study area revealed mixed impressions. Among the variables considered, age of the household head, income of the household, house ownership, and household food expenditure had a statistically significant effect on food insecurity in the study area. This study adds to the literature by contextualizing urban food insecurity within Sen's Entitlement Framework and the Sustainable Livelihoods Framework in post-conflict areas. Most importantly, the study has delivered findings that call for targeted interventions on income diversification, affordable housing, and gender-responsive policies. This is followed by practical recommendations for policymakers, underscoring the need for context-specific approaches to urban food insecurity in conflict-affected areas.
Determinants and Trend Analysis of Profitability of EFFORT Companies; Economic Performance Analysis in case of Tigrai:
(Mekelle University, 2025-10-25) Gebrehiwet Romha
The purpose of the study was to examine what determines profitability, its trend healthiness and to extent that war caused profitability to shift down in EFFORT companies in the Tigrai Region, Ethiopia. Using an unbalanced dataset of 16 companies selected from 17 total companies based on data availability criteria, a census sample design of company-level secondary data were collected between 2010 and 2024 and analyzed using the generalized method of moments (GMM) technique, specifically the system GMM estimator. Unlike existing studies that adopted inappropriate models and misusage of LDPD models, this study properly used the standard step-by-step analysis of the LDPD models for the identification of determinants; and the panel data trends as well as DID models for the trend analysis and war effect estimation of EFFORT companies’ profitability, respectively. Having passed all the basic tests, the persistent LDPD model becomes jointly and strongly significant. The empirical results show that lagged profitability, cost efficiency, managerial efficiency, working capital and market competition are the significant EFFORT-level major determinants of profitability in Tigrai. However, the roles of liquidity, company growth, and capital intensity variables were not validated by this study. In addition, these companies have been experiencing inconsistent and fluctuating profitability trends over the same time range. Similarly, the Tigrai war experienced a very huge negative shift and downtrending effect on profitability during the war period. Thus, these findings implied that EFFORT companies have had serious and significant efficiency gap in resource utilizations and cost management, which in turn affects the economic performance of Tigrai Region. This study has also summary policy implications that EFFORT corporate should focus on maximizing innovation efficiency and productivity by relocating resources to more productive performers. Besides, as current profitability largely depends on contemporaneous capacities and efforts, EFFORT leadership needs to give attention to continuous reforms like freeing these companies from political intervention, letting them focus on business agendas only, and thereby improving the unhealthy profitability trends.
DETERMINANTS OF FOREIGN DIRECT INVESTMENT IN ETHIOPIA
(Mekelle University, 2025-11-25) MULATA NGUSIE
Foreign Direct Investment (FDI) plays a vital role in accelerating economic growth and development in developing countries like Ethiopia by supplementing domestic capital, creating employment, and enhancing technology transfer. The main objective of this study is to investigate the determinants of foreign direct investment in Ethiopia during the period 1990-2022. The analysis employed both descriptive and econometric techniques to identify the key macroeconomic and institutional factors influencing FDI. This study examines the determinants of foreign direct investment (FDI) inflows in Ethiopia using recent data and extended variables such as government expenditure and political instability. The ARDL model used in this study is specifically tailored to capture the dynamic relationship between FDI and its determinants, allowing for the analysis of both short-run and long-run interactions despite policy reforms, FDI inflows remain low compared to the country’s potential. The findings aim to provide insights for policymakers to design strategies that effectively attract and sustain foreign investment.Variables such as gross domestic product per capita (GDPk), inflation rate, exchange rate, trade openness, government expenditures (EXPN), and political stability were included in the model. The regression results reveal that GDPk, trade openness, and EXPN have a positive and significant effect on FDI inflows, while inflation, exchange rate volatility, and political instability have a negative and significant impact. The findings imply that maintaining macroeconomic stability, improving infrastructure, and ensuring political and institutional stability are crucial for attracting and sustaining foreign investment in Ethiopia. The study recommends that policymakers focus on creating a stable investment environment and strengthening economic reforms to enhance the country’s competitiveness in the global investment market.
DETERMINANTS OF MARKET PARTICIPATION OF SMALL SCALE DAIRY FARMERS: THE CASE OF MEKELLE CITY
(Mekelle University, 2025-03-01) RAHEL GEBREYESUS HAILU
This study aimed to investigate the factors influencing market participation among small-scale dairy farmers in Mekelle city, focusing on demographic features, farm characteristics, access to services and infrastructure, credit availability, training programs, and access to information. A quantitative research design was employed, using a survey to collect data from 214 dairy farmers in urban area. The study utilized descriptive statistics and binary logistic regression analysis to identify key factors affecting market participation. The results revealed that farm ownership, access to essential services, credit access and availability of market had a significant positive impact on farmers' participation in dairy markets. Unexpectedly, participation in training programs was found to be negatively affecting market engagement. The study concluded that improving land ownership issues, access services and to credit, and timely market information would enhance market participation among dairy farmers. Policy recommendations included developing tailored financial service for smallholder farmers and improving access to market information. Future research could further explore the role of training on market participation of dairy farming.
Factors Affecting Growth of Micro and Small Enterprises: The Case of Enticho Town
(Mekelle University, 2025-11-25) Etenesh Yeabyo
This study examines the internal and external determinants influencing the growth and sustainability of Micro and Small Enterprises (MSEs) in Enticho Town, Tigray, Ethiopia. Although MSEs play a central role in job creation, income generation, and structural transformation, their growth remains constrained by multiple financial, infrastructural, and institutional factors. Using quantitative cross-sectional research design, primary data was collected from 155 MSE operators across manufacturing, trade, service, construction, and urban agriculture sectors. The data were analyzed using descriptive statistics, correlation analysis, and multiple linear regression to identify the most significant predictors of enterprise growth. The findings reveal that infrastructure quality, workplace conditions, internal managerial capacity, and marketing capability are key positive contributors to MSE growth. Financial constraints and governance related challenges, including complex regulations, taxation burdens, and administrative inefficiencies negatively affect performance and limit expansion. The regression model explained a substantial proportion of the variation in MSE growth, underscoring the combined effect of internal competencies and external enabling conditions. The study concludes that sustainable MSE development requires integrated interventions that address financial access, infrastructure, capacity building, and institutional reforms. Improving access to credit, investing in enabling infrastructure, strengthening entrepreneurial and managerial skills, and enhancing transparent governance are essential for fostering a supportive business ecosystem. The findings provide important insights for policymakers, local administrators, development partners, and practitioners involved in promoting inclusive economic growth.
Factors that Affect the Productivity of Sesame of Smallholder farmers: The Case of Tahtay Adiyabo Woreda, Northwestern Zone, Tigray Region, Northern Ethiopia.
(Mekelle University, 2025-11-23) Yirdaw Hagos
This study analyzed the factors affecting the productivity of sesame among smallholder farmers in Tahtay Adiyabo Woreda, Northwestern Zone of Tigray, Ethiopia. The main objective was to identify agronomic, socio-economic, and institutional determinants influencing sesame productivity and to provide policy-relevant recommendations for improving output. A mixed research design was employed, integrating both qualitative and quantitative approaches to enhance data reliability. Primary and secondary data sources were used. The study relied on cross-sectional data collected from 242 smallholder farmers during the 2024/2025 production season through structured questionnaires. A multistage sampling technique was used to select three kebelles, based on their sesame production potential, followed by proportional random sampling of farm households. To analyse the data, descriptive statistics such as means, frequencies, percentages, and standard deviations, and an econometric model, particularly the Ordinary Least Squares (OLS) estimation technique, were used. The econometric analysis utilized an Ordinary Least Squares (OLS) regression model grounded on the Cobb–Douglas production function to estimate the determinants of sesame productivity. Descriptive results revealed that the average household head was 46.6 years old with a family size of 5.11, a mean landholding of 4.24 ha, and 13.6 years of farming experience. The mean log of sesame productivity was approximately 13.8 quintals per hectare. The OLS results (R² = 0.511, F = 20.99, p < 0.001) identified land size, market access, extension service, off-farm participation, and pesticide use as statistically significant variables influencing sesame productivity. The results show that variations in productivity across kebelles: Adiaser recorded the highest yield (16.38 quintals/ha), followed by Aditsetser (14.58 quintals/ha), while Ademiti had the lowest (11.45 quintals/ha). The results highlight that productivity gaps are mainly due to uneven institutional support, input access, and market linkages. Overall, the study found that sesame productivity in Tahtay Adiyabo Woreda is constrained by intertwined socio-economic and institutional factors rather than demographic ones. It recommends strengthening agricultural extension services, improving credit accessibility, promoting off-farm income diversification, and investing in market and infrastructure development. Additionally, promoting climate-resilient practices and soil fertility management is crucial to enhancing productivity and sustaining sesame farming.
Impact of Food and Cash Remittances on Household Food Insecurity Response in Tigrai Region (In case of the Central Statistical Agency Data, 2018/2019)
(Mekelle University, 2025-11-25) Afewerky Tadesse Kifle
Household food insecurity remains a critical development challenge particularly in-low and middle income countries where livelihoods are vulnerable to economic and environmental shocks. The study examines the impact of food and cash remittances on household food insecurity, outcomes exploring whether transfers and improve dietary adequacy in the targeted Tigrai region applying qualitative and quantitative descriptions, the T-test and Robustness check methods. Food insecurity can be identified in various suspects and is a pervasive global issue impacting individuals which can be characterized by limited nutritious food in the household. Using household level survey data and applying econometric characteristics the analysis assess how different forms of remittances influence food access, consumption patterns and copying strategies. The paper used secondary data from the central statistics agency (Ethiopia Socio economic Survey) and analyzed to identify food insecurity around the zones and woredas of the region. The findings indicate that both food and cash remittances significantly contribute to reducing household food insecurity, though their effects vary in magnitude and mechanism. Therefore, the findings highlight a significant disparity and show ways of minimizing the food insecurity across the region. It also highlights the importance of migration linked support system and suggests that policies facilitating safe migration and efficient remittances channels can enhance household resilience In line to this, I insights contribute to a deeper understanding of how remittance flows serve as informal social protection in food insecure settings.
IMPACT OF SMALL-SCALE IRRIGATION TECHNOLOGY ON FARM HOUSEHOLD WELFARE IN TAHTAY MAYCHEW WEREDA, TIGRAY REGION, NORTH ETHIOPIA
(Mekelle University, 2025-08-25) ALEMSHET YIHDEGO
Methodology: This study investigates the impact of small-scale irrigation technology (SSIT) on farm household welfare in Tahtay Maychew Wereda, Tigray Region, North Ethiopia, focusing on three kebeles Hadi Shadi, May Sye, and May Berazyo with a combined population of 24,640. Despite the increasing adoption of SSIT, empirical evidence on its socio-economic and genderrelated impacts in this drought-prone region remains limited. Employing a mixed methods approach, the study surveyed 200 households (150 SSIT adopters and 50 non-adopters), complemented by focus group discussions and key informant interviews. Quantitative analysis utilized descriptive statistics, Probit regression, and Propensity Score Matching to assess impacts on income, food security, and women’s empowerment. Results: Findings reveal that SSIT adoption significantly enhances household welfare, increasing annual income by 78% (32,400 ETB vs. 18,200 ETB), improving dietary diversity, reducing food shortages (24% vs. 62%), and boosting women’s decision-making and income control (empowerment index: 0.58 vs. 0.32). Adoption is driven by education, landholding size, and access to extension and credit services, though challenges like seasonal water shortages (52%), equipment scarcity (43%), and labor demands (37%) persist. Conclusion: The study concludes that SSIT is a transformative tool for rural livelihoods and gender equity but requires stronger institutional support and infrastructure to ensure sustainability. Recommendations include expanding extension services, subsidizing equipment, and improving water management to maximize SSIT’s impact.
Investigating the Impacts of Urban Poultry Farming on Household Welfare using Propensity Score Matching Technique: A Case Study of Shire Town in Northern Tigray Region, Ethiopia
(Mekelle University, 2025-07-25) Goyteom G/her
This study examines the socioeconomic and nutritional impacts of urban poultry farming on household welfare in Shire Town, Tigray, Ethiopia. Using a mixed-methods approach, it combines quantitative data from 306 household surveys with qualitative insights from focus group discussions and key informant interviews. Analytical methods such as Propensity Score Matching and logit regression were applied to assess the causal effects of poultry farming on income, dietary diversity, health, and education outcomes. The results show that urban poultry farming significantly boosts household income, which supports essential expenditures like food, healthcare, and education. Poultry-farming households demonstrated better dietary diversity and more frequent consumption of protein-rich foods, along with improved health status and reduced medical costs. Educationally, these households had higher school enrollment rates and faced fewer financial barriers. Despite these benefits, challenges, including high feed costs, disease outbreaks, limited veterinary services, and market access constraints, affect productivity and growth. The study highlights urban poultry farming’s role as a sustainable livelihood strategy and recommends improvements in veterinary care, feed affordability, market infrastructure, and supportive urban policies, with suggestions for further research on health impacts and gender dynamics.
Specialization: (Development Policy Analysis) A Research on Household Economic (Income, Expenditure, and Welfare) Impacts of Dairy Farming in Adwa City, central Zone, Tigray Region,
(Mekelle University, 2025-09-25) Hager Takele
This study investigates the household economic (income, expenditure, and welfare) impacts of dairy farming in Adwa City, Central Zone, Tigray Region, Ethiopia. Using a mixed-methods design, both quantitative and qualitative data were collected through household surveys, focus group discussions (FGDs), and key informant interviews (KIIs). A stratified random sampling technique was employed to select 370 respondents, comprising 115 dairy-farming and 250 non-dairy households, along with 5 key informants. Quantitative data were analyzed using Propensity Score Matching (PSM) and quantile regression, while qualitative data were examined through thematic analysis. The findings reveal that dairy farming significantly enhances household income, increases expenditure on education and healthcare, and improves dietary diversity and nutritional outcomes. These benefits are particularly notable among low-income households, indicating the pro-poor potential of dairy-based livelihoods. However, the study also identifies structural challenges such as limited access to quality feed, veterinary services, and market infrastructure. It concludes that strengthening institutional support, promoting gender-responsive programs, and investing in value addition are essential to maximize the contribution of dairy farming to sustainable household welfare and post-conflict economic recovery in Adwa and similar settings.
Technical Efficiency of Urban Savings and Credit Co-operative Organizations (SACCOs): A case study of Mekelle city, Tigray.
(Mekelle Univerity, 2025-02-23) G/slassie Kidanu
The efficiency of urban SACCOs is critical for financial inclusion and economic development. This study examines the technical efficiency of urban SACCOs in Mekelle city, Tigrai, using stochastic frontier Analysis (SFA) and a census method covering all SACCOs in the study area. The research aims to assess the efficiency levels of SACCOs, identify factors influencing efficiency, and provide policy recommendations for improving their performance. A quantitative approach was employed, utilizing financial and operational data from SACCOs. The SFA model was applied to estimate efficiency scores, and relevant explanatory variables were analyzed to determine their impact on efficiency. The findings reveal that, on average the SACCOs in the study area were operating efficiently with high level of efficiency difference. Significant number of SACCOs exhibit inefficiencies due to factors such as low members saving mobilization, inadequate managerial capacity, potential challenges with digital banking adoption, suboptimal resource utilization, and regulatory constraints. The results underscore the need for targeted policy interventions, increase member savings, capacity building initiatives, manage administrative expense, and improved governance structures to enhance SACCOs efficiency. Strengthening regulatory frameworks and promoting financial education among SACCOs can further contribute to the sector’s sustainability. The study provides valuable insights for policy makers, SACCO managers, and stakeholders aiming to improve the financial performance of urban SACCOs in Mekelle city.
THE DETERMINANTS OF ADOPTION OF IMPROVED MAIZE VARIETY IN KOLA TENBEN DISTRICT, CENRAL ZONE TIGRAY, ETHIOPIA
(Mekelle University, 2025-09) Ataklti K/mariam
In most of the world’s poorest countries and especially, those in Africa, agriculture contributes to offer the leading sources of employment and to contribute large fraction of national income. In many of these countries, however, agricultural productivity is extremely low. Maize plays a major role in the livelihood and food security of most small holder farmers in Africa. Adoption of improved maize varieties in agricultural production is considered as one of the most promising ways to ensure food security and alleviate poverty in Ethiopia. However, the adoption and dissemination of these varieties were constrained by various factors. This study was aimed at identifying the factors that influence adoption and adoption of improved maize varieties in kola Tenben District of Central Zone, Tigray. Cross-sectional household level data were collected during the 2024/25 production year from 137 randomly selected sample household and used for the study. Both descriptive statistics and econometric model were used to analyze the data. The result of descriptive statistics indicated, existence of significant mean and proportion differences between adopters and non-adopters in terms of age of the household head, family size, educational level of the household head, frequency of contact with extension agent, access to fertilizer, number of oxen owned and radio ownership. From seven explanatory variables included in the model, four variables (frequency of contact with extension agent, access to fertilizer, number of oxen owned and radio ownership) were the important variables which had positively and significantly influenced adoption and adoption of improved maize varieties. Based on the findings, the following recommendations were forwarded. Policy and development intervention should give emphasis to the improvement of institutional support system by strengthening the existing agricultural extension system, providing the required fertilizes and agricultural training on time, expanding the distribution of radio program and expanding access to credit for the purchase of oxen and other inputs to achieve the target of adoption of improved maize varieties for increasing the production and productivity of smallholder farmers in Kola Tenben district.
The Determinants of Institutional Credit Access of Smallholder Farmers in woreda Raya Alamta. Southern zone of Tigray, Northern Ethiopia
(Mekelle University, 2025-08-25) Muleta Amare
This study aimed to analyse the determinants of access to formal credit by smallholder farmers in Raya Alamata Woreda. Preferences of smallholder farmers towards financial credits was scored and ranked, sources of financial credit for smallholder farmers were assessed and factors affecting formal credit access of small holder farmers were analysed and identified in the study areas. A stratified random sampling procedures were employed to select three rural Kebele administrations and 167 farm household heads were selected using probability proportional to size. Semi-structured interviews were employed for collecting quantitative data from the sampled farm households in the study area. Three Focus group discussion, fifteen key informants’ interview and field observations were held to generate qualitative data. Ranking techniques of credit sources were applied to know the preferences of all respondents and focus group participants for credit sources. Descriptive statistics and binary logit model were employed for analysing the quantitative data. STATA version 14 was used for data analysis. The results of the study were indicated that, out of 167 respondent house hold heads, 74 of the sampled farm households were formal credit users, whereas the remaining 93 of the respondents were non-users. Relatives, friends and neighbours were preferred as the best credit source for borrowers in the study area than other sources due to its interest free, low transaction cost and adjustments of repayment time. In the study areas, access to formal credit services of smallholder farmers was limited due to some-times inconvenience of group lending in which group members took responsibility of paying the defaulters risk, high interest rate charged on borrowers and some respondents having external financial supports. But, the logit model results reveal that sex of household heads, attitudes of household heads towards credit risks, preference of household heads for group lending, age of the household heads and experience of the household heads in credit using are important factors significantly affecting access to formal credit by smallholder farmers.
THE EFFECT OF SMALL SCALE IRRIGATION ON HOUSEHOLD INCOME AND FOOD SECURITY (IN CASE OF LAELAY LEGOMTY, WEREDA ADWA)
(Mekelle University, 2025-09-25) GebretsadkanTetemkeGebray
Shortage in amount and variability in trends of rainfall, and crop failure are serious problems indeveloping countries like Ethiopia and in Weredaadwa in particular. Small- scale irrigationactivities has been implemented by the rural households as a means of increasing productivity byreducing crop failure associated with erratic rain fed agriculture and ensuring smallholderfarmers income though improving their production. This study was conducted to estimate theeffect of small-scale irrigation of rural households’ income and food security in LaelayLegomtyweredaadwa. In order toachieve the objective, primary data was collected in the way of questionnaire survey, groupdiscussion and key informant interviews in sample kebeles, and systematically andrandomly selected 60 irrigation users and 60 non- users rural households. The propensityscore matching technique was used to reduce the possibility of bias due to unobserved factors.Logit regression model and OLS model was used to estimate propensity score and to identify determinants ofrural households’ user in irrigation effects on income and food ecurity of the household in the rural area. The average user effect of smallscale irrigation on theincome of the rural households was identified by using the nearest-of non user of irrigation. Estimated outcome variable was statistically significant at 1% level of significanceand insensitive to unobserved factors. Irrigation user rural households in the area improvedtheir income by Birr 250,466 than non- users. Thus, the study concluded that user in small-scaleirrigation has significant positive effect on rural households’ income and food security of irrigation users in the area. The result revealed that user in small-scale irrigation was significantly and positivelyaffected by age, educational level of the household head, active family labor,familysize,land holding, credit access , livestock ownership of the household and market information services. Butsignificantly and negatively affected by extension services of the household head.
The Impact of Access to Microfinance Credit on Multidimensional Poverty Index (MPI) Reduction Among Female-Headed Households in Wukro Town, Eastern Zone, Tigray Region, Ethiopia
(Mekelle University, 2025-11-25) Fasil Adane
This study examines the impact of access to microfinance credit on multidimensional poverty (MPI) among female-headed households in Wukro Town, Tigray Region, Ethiopia. Employing a mixed-method approach that combines quantitative household surveys with qualitative interviews, the research investigates how microfinance influences income, education, health, and overall living standards. The findings indicate that microfinance significantly reduces multidimensional poverty by enabling women to start or expand small businesses, support children’s education, and access basic healthcare and food. However, microfinance alone does not fully address the deeper challenges in post-conflict settings; many households continue to face psychosocial stress, limited social inclusion, and unstable income due to market fluctuations. These results align with the multidimensional poverty frameworks of (Sen, 1999) and (Alkire, 2015), emphasizing the need to integrate financial services with social, psychological, and community support. The study concludes that while microfinance is a critical tool for economic empowerment, its long-term effectiveness in reducing MPI in conflict-affected areas requires complementary interventions such as mental health support, gender-sensitive programming, and broader post-conflict rehabilitation.