Abstract:
With more than 80% of the population living in rural areas and Ethiopia being primarily an
agrarian nation, the development of rural infrastructure is crucial for boosting the country's
socioeconomic development. Since 2010, Ethiopia has acknowledged the importance of rural
road development and has invested significantly in this area. The study aims to investigate how
access to rural road transport affects smallholder commercialization in Ethiopia. For this study,
the data is compiled from the Ethiopian Socioeconomic Survey, run by the Central Statistics
Agency of Ethiopia and the World Bank Living Standards Measurement Study-Integrated
Surveys on Agriculture team. The descriptive statistics result shows that approximately 54.35%
of households in rural Ethiopia have access to an all-weather road, indicating a moderate level
of connectivity. The study finds that road access significantly improves market participation and
the extent of commercialization, though the effect on sales is small. The study also found that
participation and the degree of participation in the crop output market are influenced by market
accessibility, credit accessibility, access to extension services, availability of irrigation facilities,
off-farm income, natural shocks, land size, total quantity of output produced, rainfall
availability, regional dummies, and dummies for survey periods. Therefore, there should be
investments in market infrastructure, access to institutional supports, agricultural productivity,
irrigation, and climate-smart agriculture in addition to rural roads to help farmers produce
more and supply output to the market. Furthermore, designing region-specific policies can
enhance output market participation of smallholder farmers