Does Bonga sheep producers’ cooperative membership improve households’ income in southern Ethiopia?

Bonga sheep is one among the known indigenous sheep breeds in Ethiopia with a high rate of growth and weight gain under smallholder management. To enhance the sheep productivity, 16 Bonga sheep breed improvement cooperatives were established in Kaffa zone of southern Ethiopia. Even though the cooperatives bring success in terms of breed improvement and income generation, there’s no empirical evidence of this. Thus, this study was intended to identify factors affecting cooperative membership and estimate its impact on farmers’ income. To do this, data from 320 sampled households were collected by using multistage sampling techniques. For analysis, the endogenous switching regression (ESR) model was employed. The result of ESR estimation shows that the probability of farmers’ membership decision is decided by the number of sheep owned, extension contact, and proximity to a cooperative office. The model results further confirm that members get significantly better (34%) than if they had not been members and non-members would have even performed better (56%) than members if they had joined cooperatives. This suggests sheep breeding cooperatives are effective in improving the income of sheep producers. Thus, efforts need to be made to tackle factors that are impeding households’ cooperative participation. Further, strengthening of the existing cooperatives and establishment of additional cooperatives is suggested.