Does livelihood capital influence the livelihood diversification strategies of smallholder rice farmers? Evidence from the Mekong Delta of Vietnam

Tien D. N. Ho, Takuji W. Tsusaka, John K. M. Kuwornu, Lan M. T. Lam and Thuong T. Vu

Cogent Economics & Finance, 2024, vol. 12, issue 1, 2397456

Abstract: Climate and other shocks threaten the livelihoods of rice farmers in Vietnam, forcing them to diversify their livelihoods. This study investigates the diversification strategies of rice farmers in the Mekong Delta of Vietnam. Based on 405 rice farming households in Tien Giang, Dong Thap, and Can Tho provinces, the results of the Hausman test showed that the four strategies, namely rice farming only, on-farm activities (rice farming and other farming activities), rice and non-farm activities, and on-farm and non-farm activities, were used in this study. A multinomial logit regression was used to measure the influence of rice farmers’ livelihood capital on their adaptive strategies. The results show that human capital (gender, household size, dependency ratio), social capital (extension visits, cooperatives’ membership), natural capital (farm size, land rent, access to water for farming), physical capital (distance to markets, distance to district capital), and financial capital (fixed asset, access to credit, and government support) are significant factors affecting households’ diversification decisions. Intervention programs should encourage farmers, especially women, to participate in cooperative and extension visits to improve their skills, access to credit, and income opportunities.Vietnamese rice households in the Mekong Delta are forced to diversify their sources of income due to the threat posed by climate change. The diversification tactics used by rice households in Vietnam’s Mekong Delta are examined in this study. The Hausman test results, based on 405 rice households in the provinces of Tien Giang, Dong Thap, and Can Tho, indicated that four strategies were employed in this study: rice farming only, on-farm activities (rice farming and other farming activities), rice and non-farm activities, and on-farm and non-farm activities. The impact of livelihood capital on the adaptive strategies of rice farmers was assessed using a multinomial logit model. The findings showed that all major forms of capital—financial, social, physical, and natural—play substantial roles in influencing households’ decisions to diversify. In order to increase farmers’ skills, credit availability, and income prospects, intervention programs should urge farmers—especially women farmers—to take part in cooperative and extension visits.

Date: 2024
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DOI: 10.1080/23322039.2024.2397456

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