Livelihood strategies, baobab income and income inequality: Evidence from Kordofan and Blue Nile, Sudan

This paper analyses the relationship between livelihood strategies, baobab income, and income inequality in rural Sudan. Baobab is an emerging commercial crop with emerging specialised value chains in Kenya and Malawi. In Sudan, baobab traditionally has been used with limited research on evolving business opportunities and associated implications for rural development. The study utilizes survey data from 374 randomly sampled households from two states in Sudan (Kordofan and Blue Nile) and examines livelihood strategies, income inequalities and the role of baobab income for rural households. We use principal component analysis (PCA) and hierarchical cluster analysis to identify three household clusters in each region based on the income sources. In Kordofan, the identified strategies were ‘livestock and baobab-based’, ‘livestock and crop-based’, and ‘business-based’. In Blue Nile, they were ‘mixed’, ‘business-based’, and ‘crop-based’. The clusters exhibited variations in asset endowments and wealth, with differences in access to land, savings, credit, and technology. Households classified under the livestock-baobab strategy (Kordofan) and the mixed strategy (Blue Nile) had the highest degree of poverty, lowest per capita income, and baobab contributed 33% and 26% of total income, respectively, underscoring the importance of baobab income to the livelihood security of poorer households. To analyse inequality in distribution of income Gini coefficients are estimated for regions and livelihood strategy categories. Baobab income contributes to reducing income inequality: 10% increase in baobab income reduces inequality by 6.5% and 11% in Kordofan and Blue Niles, respectively, but shows also in Kordofan better off households generate higher incomes from baobab.