Entrepreneurship Drivers in the Non-farming Sector: Rural-Urban Contrast

Abstract

Using data from 5262 households, we explored entrepreneurial drivers in the
non-farm sector. Marital status, religion, ethnicity, education type and the size
of the household plays different roles for rural and urban households’
engagement in non-farm enterprises. In both urban and rural areas, household
size is a driver to non-farm enterprise engagement. Shocks in the household
such as illness drive rural households to engage in the non-farm enterprise
sector. However, drought restrains the participation of rural households in nonfarm
businesses. Divorced households engage more in enterprises. Unmarried
households, however, witnessed less involvement in the sector and it is
significant for rural households. Urban illiteracy and rural primary education
significantly determine households’ involvement in the non-formal sectors.
Moreover, the study identified a non-linear relationship between age and
enterprise engagement where engagement in non-farm enterprises increases
with age up to 58 years and then declines and it is significant for urban
households. In the case of urban households, male-headed households are
driven to non-farm engagement. Understanding variations in marital status,
socio-economic make-ups, entrepreneurial training, and education can be
plausible areas of intervention to adequately understand both the
entrepreneurial ecosystem and strengthen the non-farming entrepreneurial
sector livelihood.