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Drought Shocks and Labor Reallocation in Rural Africa: Evidence from Ethiopia

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  • Musungu, Arnold L.
  • Kubik, Zaneta
  • Qaim, Matin

Abstract

We study how rural households in Ethiopia adapt to droughts through labor reallocation. By using three waves of panel data and exploiting spatial-temporal variations in drought exposure, we find that households reduce on-farm work and increase off-farm self-employment in response to both short-term and persistent droughts, without abandoning family farming. Diversification into off-farm activities is driven by drought-related productivity declines in agriculture and contributes to consumption smoothing. Households with better access to markets and financial services find it easier to reallocate labor off-farm. Our results highlight the importance of strengthening the rural non-farm economy to enhance rural households’ climate resilience.

Suggested Citation

  • Musungu, Arnold L. & Kubik, Zaneta & Qaim, Matin, 2023. "Drought Shocks and Labor Reallocation in Rural Africa: Evidence from Ethiopia," Discussion Papers 338675, University of Bonn, Center for Development Research (ZEF).
    • Handle: RePEc:ags:ubzefd:338675
    DOI: 10.22004/ag.econ.338675
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    Labor and Human Capital;

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