Rural income diversification in Rwanda: Opportunities and challenges

In contrast to employment profiles from other low-income countries, we find that the probability of a worker from an agricultural household in Rwanda engaging in rural, off-farm wage labor decreases as household welfare increases. Agricultural households that have workers seeking to hire out their labor tend to have the smallest landholdings, while households that hire in labor have the largest landholdings. Additionally, households with a higher share of members who completed primary education are less likely to hire out their labor, especially for agriculture wage work. These results suggest that programs that offer support services to agricultural households, such as financial services and affordable and relevant education, may be important in incentivizing these households to engage in entrepreneurship and form their own businesses or to seek wage employment in more remunerative sectors than agriculture.