Determinants of farm diversification in integrated crop-livestock farming systems in Ghana

Agricultural diversification has been identified as one of the mechanisms for managing household food security and poverty in developing economies, because it can spread the risk among multiple production enterprises and provide a range of food items for the households. By examining the integrated farming systems of 608 smallholders in Ghana, this paper presents empirical evidence to support the development of effective strategies that enhance diversified farming systems. The estimated mean diversification indices were 0.45, 0.32 and 0.59 for crop, livestock and crop-livestock diversification systems, respectively. Using the Cragg two-step regression model, this paper shows that the decision to diversify and the extent of diversification are distinct decisions affected by different sets of factors. Likewise, the effect of these factors also varied across the three categories of diversification examined. Careful consideration needs to be given to the selection of factors and the methods for examining the diversification process to avoid confounding recommendations. The findings underscore the importance of households' access to tillage equipment, fertilizers, credit and market information in encouraging farmers to diversify.