Farm and non-farm activities are playing an important role in improving the lives of rural families. However, non-farming activities are determined by various factors. The aim of this study was to identify and analyze the variables that affect non-farm participation. Both a descriptive and an econometric model were used to analyze this issue. Mean and percentage were used as descriptive methods, while the binary probit model was used to try to explain the econometric model. Variables such as age, distance to market, access to credit, training, land size, membership in iqub, and marital status significantly determine non-farm participation. The recommendation of the results of this study was that the government should focus on gender equality, land tenure, providing various pieces of training, and establishing infrastructure connecting rural and urban areas such as roads, electricity, and telephone services to improve the livelihood of rural families.

Women have an important role in business participation that has a great impact on improving households’ livelihoods. The main objective of this study was to describe factors determining women's non-farm participation in non-farm activities. In order to identify the determining factor of women’s participation in non -agricultural activities, an English questionnaire was translated into Afan Oromo in a way that respondents and data collectors could understand. For analyzing the data, the researcher used the binary logit model, and the result of the study shows that the determinants of women's participation in non-agricultural activities were age, family size, household property ownership, land size, non-farm training, lack of access to credit, membership in Idir, women's participation in local community affairs, and distance from the market location. Among these determinant variables, land size, family size, and distance from market location negatively influence women's participation, while the rest positively influence women's participation in non-agricultural activities. Furthermore, socioeconomic factors such as society's backward attitude toward women and women's low participation in education have been identified as major issues. Accordingly, the study recommended that the government, NGOs, and various religious leaders work together to minimize the socio-economic impact on women, and the women's and children's affairs office in the study area should work with the university researchers to identify the problems faced by women.

In rural areas where the farmer's livelihood is based on farming, non-farm activity was considered as an additional source of income that plays an important role in improving household consumption. The Hackman results indicate that non-farm participation decision of households has positive significant effect on their level of household consumption. Incomes of the household, education level and family size have positive significant effect on household consumption. Variables such as education, access to credit, membership to iqub, household health status, access to training, and own savings, were identified to be the main factors positively influencing household decision to non-farm with a statistical significant level. The study's recommendation was; provide various pieces of farm and non-farm training provide the infrastructure that is a barrier to rural development and develop the culture of saving in the community.