How Social Status Contributes to Sustainable Livelihoods? An Empirical Analysis in Ethiopia

Abstract

This paper scrutinized the links between social status and income of rural households to provide insight into how social status is indicated and used as a strategy for improving livelihood income. It also provides a brief look into some selected key determinants of livelihood income. We applied a two-stage least-squares estimation to household-level data from rural areas in the Tigray regional state of Ethiopia. We also proposed the latent class analysis model to identify the number of classes for the variable “social status”. The results indicate that livelihood income is significantly affected by households’ social status, indicating that high status household heads tend to enhance their participation in different social networks with the intention of strengthening the social bonds that they have and improving their status in the community, which in turn has an economic payback. Apart from this, household heads’ access to off-farm work, size of owned land, exposure to multimedia, livestock ownership and spatial proximity to towns were the variables that have significant positive effects on livelihood income.