As the share of small ruminant meat, especially sheep, in the demand and consumption of meat in general grows, information about consumer expenditure behaviour and demand parameters for live sheep will be valuable for several interest groups in the sheep industry. Using the Heckman two-stage approach, this study shows that sheep prices and household income, as well as socio-demographic factors, including household size and composition, significantly affect the likelihood of buying live sheep and expenditures on live sheep. Projections of live sheep demand and supply in Addis Ababa in 2010 and 2020 show that sheep producers in Addis Ababa alone will be able to meet up to only 27% of the demand
