Working Paper 241 - Long term consequences of consumption seasonality

The average child in an agricultural community consumes substantially more food during the months after a harvest than the months before, despite efforts to smooth consumption. In this paper we use a 20-year panel data set from Tanzania to test whether consumption seasonality has long-run implications for human capital development. Using repeated measures of consumption during a 3-year period in the early 1990s, we model the annual consumption cycle as a function of household characteristics, and then match statistics from household-specific consumption profiles to human capital outcomes observed in 2010. We find large effects: households who are able to decrease the intra-annual standard deviation of consumption would experience the same long term benefit as a household that increases mean consumption by 3%.