Determinants of Household Participation in Land Rental Markets in Amigna District, Arsi Zone of Oromiya Region, Ethiopia

Abstract

This study examines factors affecting household participation and intensity of the participation in land rental markets using data collected from 118 households. Results revealed that landholding and age of the household heads are important variables which had an inverse and significant influence on participation and the intensity of participation in land renting-in market, but positively affect renting-out market. On the supply side, having less oxen and being aged are more likely to affect renting-out. Credit market imperfection, tenure insecurity and poor infrastructure development remain important factors impeding the function of land rental markets. These suggest that interventions should emphasize facilitating land-related transactions through creating effective micro-finance institutions, public awareness and strengthening enforcement of formal rules in land rental markets.

Keywords: Land tenure, land renting, participation, land markets, contracts