The study aimed to assess the role of rural-urban linkage on rural livelihood diversification in developing countries. A Systematic Random Sampling Technique was employed to select Households’ Heads. Data were collected using structured questionnaires from three surrounding rural kebele sampled households through face to face interview. The study found out that production linkage in the form of backward is satisfactory but, forward linkage does not exist. Linkage in the form of infrastructure, market, and financial linkage are good but not enough. Market linkage is relatively good in sale of product such as crop production, livestock product, and vegetable to the Town. Concerning factors influencing livelihood diversification activities, among 16 explanatory variables included in the model, eight of them determine the choice of livelihood strategies at less than 1%, 5% and 10% level of significance respectively. As a result, age, sex, level of education, family size, size of farmland, distance from market, and saving influenced negatively whereas access to electricity and transportation were influenced positively. To this end, by having strong rural-urban linkage rural livelihood strategies would diversify.
Key words: Rural-Urban Linkage, Livelihood Diversification, Developing countries, Rural Employment etc.
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