IMPACT OF SMALL SCALE IRRIGATION SCHEME ON DROUGHT PRONE SMALLHOLDER FARMERS’ HOUSEHOLD INCOME: THE CASE OF DIRE DAWA ADMINISTRATION, ETHIOPIA

Small scale irrigation is highly expected to play a major role in the realization of Ethiopian food security and poverty alleviation strategy. This study was intended to estimate the impacts of small-scale irrigation scheme on drought prone smallholder farmers’ household income and to identify the determinants of participation decision in small scale irrigation scheme in Dire Dawa Administration. A cross-sectional data obtained using a sample of 190 respondents selected through multi-stage random sampling techniques from four kebeles in Dire Dawa Administration in 2016/2017 cropping year were used for this study. The data were analyzed using Heckman’s two stage model. The Probit model estimation result indicates that age of the household head, frequency of extension visit, cultivated land size, perception of soil fertility and annual farm income influenced household’s participation decision on small scale irrigation scheme positively and significantly. In contrast, number of livestock owned and distance from irrigation water source influenced participation decision negatively and significantly. The ordinary least square estimation result indicates that formal education, farm size, size of cultivated land, irrigable land proportion, extension visit, input used and cooperative membership has significant and positive effect on household income. Average annual farm income of the household was also significant with the mean annual income of 32,761.02 ETB for irrigation participants, which is greater than 15,469.72 ETB for non-participants. The average treatment effect result indicates that access for irrigation on average increased household farm income by 17,219 birr and the difference is significant at 1% significance level. Strengthening institutional services like cooperative membership, extension visit, utilization of agricultural inputs is vital to expand small scale irrigation scheme in study area.