The Extent of contribution by Urban and Peri-urban Agriculture on Employment creation and Income generation in Mekelle Hadnet Sub-city, Tigray region, Ethiopia

Abstract

Urban and peri-urban agriculture (UPA) involves the production of food and non-food items within or near urban areas for household consumption or market sale. In developing countries, rapid urbanization and rural-urban migration intensify unemployment and income scarcity. This study explores the socio-economic characteristics, determining factors, and impacts of UPA on income generation and employment in Mekelle Hadnet sub-city, Tigray region, Ethiopia. Using a multistage sampling technique, data were collected from 305 urban and peri-urban farmers through survey questionnaires, focus group discussions and personal observation during the year 2024. Descriptive statistics and econometric models were employed for analysis. A multinomial logit model (MNL) identified key determinants of participation in UPA, while logit regression estimated propensity scores. A propensity score matching (PSM) model evaluated the impact of UPA on employment and income. Descriptive statistics showed significant differences between higher-participant and lower-participant households. The MNL model identified factors such as age, family size, farm distance, animal feed use, employment status, farm income, costs, and experience as significant in influencing participation. Logit regression further highlighted the significance of age, use of agricultural inputs, and livestock holdings. PSM results demonstrated that participation in UPA positively impacted farm income and employment at a 5% significance level. The average treatment effect on the treated (ATT) was an income increase of Birr 13,103 and one additional employed person compared to untreated groups. The findings suggest that UPA contributes significantly to reducing unemployment and increasing income in urban settings. Therefore, coordinated efforts by local administration, municipal authorities, researchers, and policymakers are essential to support and enhance UPA practices.