**Table 7b** <u>: Estimation of income diversification (D) and household welfare, rural areas</u>

|**Dependent Variables:**|**1990/91**|||**1995/96**|||
|---|---|---|---|---|---|---|
|<br>Income Diversification (D) and log of per|1<sup>st</sup>stage|IV|OLS|1<sup>st</sup>stage|IV|OLS|
|<br>capita consumption(Cons)|(1)D|(2)Cons|(3)Cons|(4)D|(5)Cons|(6)Cons|
|D||1.23|0.58||1.71|0.71|
|||(12.9)***|(20.8)***||(15.3)***|(28.4)***|
|Head sex (Male)|0.07|<br>-0.04|<br>0.07|0.09|<br>-0.03|<br>0.12|
||(7.2)***|(1.7)*|(4.4)***|(9.5)***|-1.1|(8.6)***|
|Head age|-0.06|0.14|0.05|-0.01|0.05|0.05|
||(3.3)***|(3.8)***|(2.0)**|(0.4)|(1.5)|(2.4)**|
|Age Squared|0.005|-0.015|-0.007|0.001|-0.008|-0.007|
||(3.0)***|(4.1)***|(2.8)***|(0.7)|(2.3)**|(3.3)***|
|Head education primary|-0.08|0.26|0.14|-0.04|0.10|0.05|
||(6.5)***|(9.6)***|(7.8)***|(3.1)***|(3.9)***|(3.0)***|
|Head education secondary or higher|<br>-0.05|<br>0.61|<br>0.53|<br>-0.04|<br>0.29|<br>0.25|
||(2.8)***|(15.1)***|(18.7)***|(2.1)**|(7.7)***|(10.2)***|
|Household size|<br>-0.12|<br>0.06|<br>-0.12|<br>-0.15|<br>0.11|<br>-0.14|
||(33.9)***|(4.2)***|(20.3)***|(38.4)***|(6.5)***|(24.6)***|
|# Boys|0.02|0.01|0.04|0.02|0.02|0.06|
||(2.7)***|(1.0)|(4.1)***|(3.5)***|(1.3)|(6.6)***|
|# Girls|0.02|-0.01|0.02|0.03|0.02|0.07|
||(3.1)***|(0.5)|(2.3)**|(4.6)***|(1.7)*|(8.2)***|
|# Male adult with primary education|0.05|-0.03|0.04|0.06|-0.04|0.05|
||(5.6)***|(1.4)|(3.5)***|(6.6)***|(2.0)*|(4.5)***|
|# Male adult with sec./ higher education|<br>0.03|<br>0.07|<br>0.12|<br>0.04|<br>0.05|<br>0.12|
||(3.9)***|(4.4)***|(10.1)***|(5.6)***|(2.7)***|(10.8)***|
|# Female adult with primary education|<br>-0.01|<br>0.09|<br>0.08|<br>0.00|<br>0.06|<br>0.06|
||06|52***|66***|04|37***|53***|
||-.|(.)|(.)|(.)|(.)|(.)|
|# Female adult with sec./ higher education|0.03|0.16|0.21|0.02|0.14|0.17|
||(3.9)***|(8.4)***|(15.9)***|(1.9)*|(7.1)***|(13.7)***|
|Per capita asset holding|0.11<br>|0.12<br>|0.29<br>|0.06<br>|0.08<br>|0.18<br>|
||(15.2)***|(6.4)***|(26.0)***|(8.9)***|(5.8)***|(20.5)***|
|Access to credit (yes)|<br>0.47<br>***|<br>-0.16<br>**|<br>0.54<br>***|<br>0.27<br>***|<br>-0.07<br>|<br>0.26<br>***|
||(21.6)|(2.4)|(17.3)|(10.5)|(1.2)|(7.6)|
|Manicaland (yes)|<br>-0.02|<br>0.40|<br>0.29|<br>0.03|<br>0.24|<br>0.20|
||(1.4)|(12.5)***|(13.4)***|(2.4)**|(8.8)***|(11.6)***|
|Masonaland East (yes)|0.03|0.32|0.25|0.14|0.08|-0.05|
||(1.2)|(10.4)***|(11.7)***|(5.7)***|(2.5)**|(2.3)**|
|Masonaland West (yes)|<br>0.08|<br>-0.10|<br>-0.10|<br>-0.72|<br>-0.05|<br>-0.19|
||(1.9)*|(2.7)***|(3.6)***|(10.9)***|(1.5)|(8.7)***|
|Matabeleland North (yes)|0.07|0.02|0.00|-1.30|0.10|0.03|
||(3.2)***|(0.7)|(0.1)|(10.5)***|(3.2)***|(1.5)|
|Midlands (yes)|0.06|0.15|0.12|-0.53|0.06|0.05|
||(1.6)|(5.5)***|(6.3)***|(9.7)***|(2.0)**|(2.4)**|
|Rainfall standard Deviations (planting)|-021|||218|||
||.<br>(10)|||.<br>(73)***|||
|Rainfall standard deviations (harvesting)|.<br>0.13|||.<br>0.76|||
||(4.2)***|||(10.1)***|||
|Constant|<br>1.18|1.76|3.55|<br>-0.71|1.67|3.49|
||(17.6)***|(11.2)***|(53.1)***|(4.1)***|(12.2)***|(60.1)***|
|R Squared (adjusted)|0.51|--|0.48|0.49|--.|0.47|
|Observations (N)|9342|9342|9342|9910|9910|9910|

Absolute value of t statistics in parentheses; * significant at 10%; **significant at 5%; *** significant at 1% 21