A STUDY OF HOUSEHOLD INCOME DETERMINANTS AND INCOME INEQUALITY

•              TABLE OF CONTENTS  LIST OF TABLES......................................................................................................................... vi LIST OF FIGURES ..................................................................................................................... viii CHAPTER ONE1. BACKGROUND INFORMATION ON MALIAN HOUSEHOLD INCOMES AND MOTIVATION FOR THIS STUDY............................................................................................................................................................. 1 
• 1.1Purpose of Study and Research Questions.........................................................-------------------------------------------------------------------------------------------------------------------------------------------------------------................... 4 
• 1.2Previous Studies on Household Incomes in Mali .................................................................................. 5 
• 1.3Limitations of the Previous Studies on Malian Household Incomes........................................................ 7 
• 1.4Structure of Thesis.................................................................................................................................. 10 
• 2.LITERATURE REVIEW ............................................................................................................................ 11 
• 2.1Household Income Portfolios and Livelihood Diversification ................................................................. 11  
• 2.1Common Income Sources..................................................................................................................... 11 2.1.
• 1.2Non-farm Income ............................................................................................................................. 12 2.1.
• 1.3Migration Remittance Income ......................................................................................................... 13 2.
• 1.2Relationship between Farm and Nonfarm Activities............................................................................ 13 2.
• 1.3Reasons for Livelihood Diversification ................................................................................................ 16 2.1.
• 3.1Risk Reduction................................................................................................................................ 16 2.1.
• 3.2Coping after a Shock....................................................................................................................... 17 2.1.
• 3.3Seasonality ..................................................................................................................................... 17 2.1.
• 3.4Credit Market Failures...................................................................................................................... 17 2.1.
• 3.5Asset Strategies.............................................................................................................................. 18 2.1.
• 3.6Returns from Income Activities....................................................................................................... 18 2.
• 1.4Determinants of Household Income .................................................................................................. 19 
• 2.2Income Inequality ..................................................................................................................................... 21 2.
• 2.1National-Level Income Inequality ............................................................................................................ 21 2.
• 2.2Community-Level Income Inequality in Rural Areas ......................................................................... 23 2.
• 2.3The Relationship between Income Sources and Community-Level Inequality.............................. 23 2.2.
• 3.1Crop Income.............................................................................................................................. 23 2.2.
• 3.2Nonfarm Income .................................................................................................. 25 2.2.
• 3.3Livestock Income................................................................................................. 26 2.2.
• 3.4Migration Remittance Income ............................................................................. 27 

Chapter THREE

RESEARCH METHODOLOGY

• 3.DATA AND INCOME DEFINITIONS ................................................................................... 28 
• 3.1Definition of Household .................................................................................................... 37 
• 3.2Definitions of Income and Income Categories .................................................................. 37 
• 3.3Basic Characteristics of the Surveyed Households............................................................ 39 
• 3.4External Events in the Koutiala and Tominian Zones that may have Impacted Household Income Portfolios...................................................................................................................... 42CHAPTER FOUR  
• 4.HOUSEHOLD INCOME PROFILES FOR TOMINIAN AND KOUTIALA........................ 43  
• 4.1Methodology...................................................................................................................... 43 
• 4.2Average Total per Capital Income Levels .......................................................................... 44 
• 4.3Household Income by Source ............................................................................................. 46 
• 4.4Distribution of Income Across Household Types.............................................................. 53 4.
• 4.1Distribution of Income Across Income Quartiles........................................................ 53 4.
• 4.2Distribution of Income Across Landholding Quartiles................................................ 56 4.
• 4.3Distribution of Income between Households Above and Below the $1/Day/Capital Poverty Line.......................................................................................................................... 59 
• 4.5Discussion of the Descriptive Statistics Analysis of Household Income Portfolios in the Tominian and Koutiala Zones................................................................................................... 61 

Chapter FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

• 5.DETERMINANTS OF HOUSEHOLD INCOME.................................................................. 63 
• 5.1Methodology...................................................................................................................... 63 
• 5.2Factors Correlated with a Higher Probability of Participation and Higher Income Levels Earned from Livestock, Nonfarm, and Cropping Income Activities........................................ 72 5.
• 2.1Livestock Income......................................................................................................... 73 5.
• 2.2Nonfarm Income .......................................................................................................... 77 5.
• 2.3Crop Income................................................................................................................. 81 
• 5.3Discussion of the Results from the Econometric Analysis of Household Income Determinants in the Tominian and Koutiala Zones.................................................................. 83 CHAPTER SIX
• 6.COMMUNITY INCOME INEQUALITY AND INCOME SOURCES................................. 86 
• 6.1Methodology...................................................................................................................... 86 
• 6.2Results................................................................................................................................ 90 
• 6.3Discussion of the Gini Decomposition Results ................................................................. 96 CHAPTER SEVEN
• 7.CONCLUSIONS...................................................................................................................... 98 
• 7.1Limitations of this Study.................................................................................................. 101 
• 7.2Future Research ................................................................................................................ 102 APPENDICES ............................................................................................................................ 103 Appendix A: Method for Calculating Households Living Above and Below the $1/day Poverty Line ......................................................................................................................................... 104 Appendix B: Real per Capital Income from Various Sources, Including F-Tests to Determine Statistical Significance of the Income Differences found between Survey Years (in 2010 Franc CFA) ....................................................................................................................................... 106 Appendix C: Real per Capital Income from Various Sources, Including T-Tests to Determine Statistical Significance of the Income Differences found between Zones (in 2010 Franc CFA) ................................................................................................................................................. 107 Appendix D: Average Share of Household Income from Various Sources, Including F-Tests to Determine Statistical Significance of the Income Differences Found Between Survey Years ................................................................................................................................................. 108Appendix E: Average Share of Household Income from Various Sources, Including T- Tests to Determine Statistical Significance of the Income Differences found between Zones ....... 109 BIBLIOGRAPHY....................................................................................................................... 110