Determinants of income-earning strategies and adoption of conservation practices in hillside communities in rural Honduras

Based on the results of participatory diagnostic surveys conducted in 95 rural communities in the hillsides of Honduras, we determine income earning strategies at the community level; identify their main determinants; and analyze the adoption of of conservation practices. Eight income-earning strategies were distinguished that reflect differences in comparative advantage between communities. We explain the choice of income earning strategy using a multinomial logit model that includes biophysical, economic, social and institutional variables. We use a probit model to show that adoption of conservation practices is determined by the type of income earning strategy, population density, market access, and organizational variables. Our results have some important policy implications. First, given the higher profitability of cash crops compared to staple foods, significant investments in road infrastructure are needed to better integrate hillside communities into the market economy. Second, while the potential of profitable conservation practices depends on the type of income earning strategy pursued, population density, market access and assistance from community-based and external organizations play an important role as well. The positive impact of population density on the adoption of many conservation technologies and investments becomes only effective at relatively high levels of population density which most communities in the rural hillsides of Honduras have not yet reached. Finally, given the limited coverage of basic public services such as public health, education, electricity, communication facilities and extension services in many hillside regions, it is imperative to substantially increase the low current levels of public expenditures in these areas. Subsequent research based on detailed household and plot level data from the same communities suggests that investments geared towards improved access to land, education market access and extension with a focus on soil fertility maintenance have particular potential to raise incomes. (c) 2005 Elsevier Ltd. All rights reserved.