Although subsistence-oriented slash-and-burn rice production is still the most important economic activity in the hilly areas of northern Laos, market-oriented activities of shifting cultivators are now becoming increasingly important. This is because the Lao government has adopted a series of policie to revitalize the market since 1986 and a cash income has become very important even in rural areas of Laos. As a result, there diversification of livelihood activities among households can be seen. The present study tries to reveal this diversification by analyzing the relationship between subsistence-oriented shifting cultivation and market-oriented activities of each household. The research site is Number 10 Village, which is located 25 km south of Luang Prabang, the largest town in northern Laos. This is a village consisting of inhabitants living there since the 1960s and 1970s, most of whom are internal refugees from the Laotian civil war (Number 10 Villagers) and inhabitants who formerly lived in Namchan Village, which was situated at a distance from the road. In 1999, Namchan villagers relocated themselves and merged with Number 10 villagers following the government's resettlement policy (Namchan villagers). They continue practicing shifting cultivation in their former territory after the relocation as before. The number of households in this merged village is 86, 81 of whom are the Khmu, the representative shifting cultivators in Laos, and the rest are Tai lowlanders (the Lao and the Nhuane) who migrated to this village for making paddy fields and trading with the Khmu. The conclusions are as follows. Among Number 10 villagers there seems to have been a disparity in wealth between paddy field owners and the others due to the gap in productivity between lowland and upland rice production. This disparity has increased after the appearance of new occupations since the 1990s. For example, there is rice credit with high interest rates that has created a distribution structure in which the rich gain more rice than needed for their own consumption and accumulate surpluses, while the poor dispose of much of their rice crop. In addition, the rich tend to engage in occupations with high income, which enable their higher standard of living, while the poor can only take part in occupations with low income, most of which is spent on rice because they fall into a rice shortage for many months. Disparity in wealth in this village is, to some degree, the disparity among different ethnic groups. Tai lowlanders in this village have become rich engaging in rice credit and other commercial activities for the Khmu. This fact suggests the importance of taking into account the relationship between Tai lowlanders and shifting cultivators in considering the poverty problem of the latter in Laos. Number 10 villagers engage in a variety of income-generating activities. Some of them specialize in these activities and decrease their dependence on shifting cultivation. On the other hand, all the Namchan villagers maintain livelihood activities that center on shifting cultivation. This is partly because population pressure in the territory of Number 10 villagers has increased while that in the territory of Namchan Village has decreased as a result of resettlement of the population from remote areas to areas along the road.
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