Improving Smallholder Farmers’ Income through Farmer Training Centers: an Impact Evaluation in Haramaya District, Ethiopia

In developing countries, agricultural advisory services (AASs) have been one of the key components of local development in terms of enhancing productivity and improving livelihoods in the face of economic, social, and environmental challenges. Nevertheless, recent studies have shown that the impact of AASs is mixed and that some empirical investigations lack methodological rigor. Furthermore, there is a dearth of context-specific empirical evidence on the impact of new approaches. One such approach is the Farmer Training Centers (FTCs) implemented by the government of Ethiopia to improve smallholder farming systems. Moreover, little is known on how best to design reform strategies for co-financing the provision of AASs given reductions in public funding. In order to address these issues, a household survey was conducted on a sample of 250 household heads in FTC and non-FTC kebeles of Haramaya district from May to October 2013. Using the same data collection instrument in both treatment and comparison areas, we generated data specifically for the purposes of impact evaluation. Due to the non-random allocation of FTCs and self-selection issues as well as the cross-sectional nature of data collected, we employ the propensity score matching procedure to estimate the causal effect of an FTC-based training on farm income. The results of the investigation indicate a positive and statistically highly significant gain of farm income (excluding chat) by the participants of the modular training, which is between Birr 9,557.47 and Birr 10,387.53 per household, on average. From the results, some recommendations on improving the performance of FTCs in impacting rural livelihoods are drawn.