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Income diversification and income inequality: household responses to the 2013 floods in Pakistan

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  • Eskander, Shaikh M.S.U.
  • Fankhauser, Sam

Abstract

In this paper we investigate the economic response of rural households to the 2013 floods in Pakistan. The case study illustrates the important roles of labor supply adjustments and income diversification in coping with climate-related risks. Using detailed household panel data that were collected before and after the 2013 floods, we find that the exposure to flood results in lower participation in farm activities. The overall effects are decreased diversification in the sources of income and ambiguous reduction in inequality which is associated with overall declines in incomes. These changes could be locked in if affected households do not have sufficient assets to resume farming. The results suggest intervention points for public policy, related to labor mobility and access to capital.

Suggested Citation

  • Eskander, Shaikh M.S.U. & Fankhauser, Sam, 2022. "Income diversification and income inequality: household responses to the 2013 floods in Pakistan," LSE Research Online Documents on Economics 113415, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:113415
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    More about this item

    Keywords

    employment; floods; income diversification; income inequality; Pakistan;
    All these keywords.

    JEL classification:

    • N0 - Economic History - - General

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