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Using panel data to estimate the effect of rainfall shocks on smallholders food security and vulnerability in rural Ethiopia

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  • Demeke, Abera Birhanu
  • Zeller, Manfred

Abstract

Ethiopia's agriculture is predominantly rainfed and hence any irregularity in weather conditions has adverse welfare implications. Using panel data, this paper analyzes the effect of rainfall shocks on Ethiopian rural households' food security and vulnerability over time while controlling for a range of other factors. To this end, we generated a time-variant household food security index which is developed by principal components analysis. Based on the scores of the index, households were classified into relative food security groups and their socioeconomic differences were assessed. The exploratory results show that compared to the less secured households, the more secured ones have male and literate household heads, tend to have a greater number of economically active household members, own more livestock, experience better rainfall outcome, participate in equb (a local savings group), and use chemical fertilizer. Fixed effects regression was used to identify the factors which affect the score's variability and the results indicate that rainfall shock is an important factor affecting households' food security over time. It is also noted that household size, head's age, participation in equb, off-farm activities, use of fertilizer, and livestock ownership positively and significantly affect the food security score. Results from multinomial logistic regression model reinforce the fixed effects regression results by showing the strong association of persistent food insecurity and vulnerability with adverse rainfall shock. A number of conclusions can be drawn from the results which are useful for policymakers as well as for agencies that engage in areas of risk and food security.

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Bibliographic Info

Paper provided by Universitaet Hohenheim, Department of Agricultural Economics and Social Sciences in the Tropics and Subtropics in its series Research in Development Economics and Policy (Discussion Paper Series) with number 57994.

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Date of creation: 2009
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Handle: RePEc:ags:uhohdp:57994

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Keywords: food security; principal components analysis; rainfall; panel data; Ethiopia; Food Security and Poverty; Research Methods/ Statistical Methods; Q18; C13;

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  1. von Braun, Joachim, 1991. "A policy agenda for famine prevention in Africa," Food policy reports 1, International Food Policy Research Institute (IFPRI).
  2. Romina Cavatassi & Benjamin Davis & Leslie Lipper, 2004. "Estimating Poverty Over Time and Space: Construction of a time-variant poverty index for Costa Rica," Working Papers 04-21, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
  3. Bigsten, Arne & Kebede, Bereket & Shimeles, Abebe & Taddesse , Mekonnen, 2002. "Growth and Poverty Reduction in Ethiopia: Evidence from Household Panel Surveys," Working Papers in Economics 65, University of Gothenburg, Department of Economics.
  4. Deressa, Temesgen & Hassan, R. M. & Alemu, Tekie & Yesuf, Mahmud & Ringler, Claudia, 2008. "Analyzing the determinants of farmers' choice of adaptation methods and perceptions of climate change in the Nile Basin of Ethiopia:," IFPRI discussion papers 798, International Food Policy Research Institute (IFPRI).
  5. Yesuf, Mahmud & di Falco, Salvatore & Deressa, Temesgen & Ringler, Claudia & Kohlin, Gunnar, 2008. "The impact of climate change and adaptation on food production in low-income countries: Evidence from the Nile Basin, Ethiopia," IFPRI discussion papers 828, International Food Policy Research Institute (IFPRI).
  6. Hoddinott, John & Yohannes, Yisehac, 2002. "Dietary diversity as a food security indicator," FCND briefs 136, International Food Policy Research Institute (IFPRI).
  7. Zeller, Manfred & Sharma, Manohar, 2000. "Many borrow, more save, and all insure: implications for food and micro-finance policy," Food Policy, Elsevier, vol. 25(2), pages 143-167, April.
  8. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  9. Webb, Patrick & von Braun, Joachim & Yohannes, Yisehac, 1992. "Famine in Ethiopia: policy implications of coping failure at national and household levels," Research reports 92, International Food Policy Research Institute (IFPRI).
  10. Stefan Dercon & John Hoddinott & Tassew Woldehanna, 2005. "Shocks and Consumption in 15 Ethiopian Villages, 1999--2004," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 14(4), pages 559-585, December.
  11. Pender, John L. & Nkonya, Ephraim M. & Jagger, Pamela & Sserunkuuma, Dick & Ssali, Henry, 2003. "Strategies To Increase Agricultural Productivity And Reduce Land Degradation: Evidence From Uganda," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25816, International Association of Agricultural Economists.
  12. Bereket Kebede, 2002. "Land Tenure and Common Pool Resources in Rural Ethiopia: A Study Based on Fifteen Sites," African Development Review, African Development Bank, vol. 14(1), pages 113-149.
  13. International Monetary Fund, 2004. "Risk Instability and the Pattern of Foreign Direct Investment in the Middle East and North Africa Region," IMF Working Papers 04/139, International Monetary Fund.
  14. Deressa, Temesgen Tadesse, 2007. "Measuring the economic impact of climate change on Ethiopian agriculture : Ricardian approach," Policy Research Working Paper Series 4342, The World Bank.
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Cited by:
  1. Kumar, Ajay & Sharma, Pritee, 2013. "Impact of climate variation on agricultural productivity and food security in rural India," Economics Discussion Papers 2013-43, Kiel Institute for the World Economy.

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