Is a Friend in Need a Friend Indeed? Inclusion and Exclusion in Mutual Insurance Networks in Southern Ghana
AbstractMutual insurance has been shown, theoretically and empirically, to be incomplete and limited by asymmetric information and lack of enforcement mechanisms. While some research has shown that networks based on kinship, neighborhood and ethnicity may provide a locus of insurance and thus a way of overcoming these problems, these studies are not fine enough to predict the inclusion and exclusion of individuals. Using data from rural Ghana, we examine the role of social relations in obtaining assistance in the face of shocks. We examine this at both the intra-household and community levels. At the household level, asking for and receiving assistance from the spouse is related to gender, the quality of the marital relationship, and the wealth of household members. At the community level, asking for and receiving help are correlated with membership in a major lineage, participation in secular organizations, the individual's fostering history, and anticipated land inheritance. We also show that these factors differ depending on whether the shortfall was for a household or personal item (as perceived by the respondent). This work helps us to identify individuals who are more likely to fall outside of mutual insurance networks and require interventions to help them cope with risk.
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Bibliographic InfoPaper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number UNU-WIDER Research Paper DP2002/25.
Length: 33 pages
Date of creation: 2002
Date of revision:
Risk; Social networks ; Mutual insurance; Intrahousehold allocation;
Other versions of this item:
- Goldstein, Markus & de Janvry, Alain & Sadoulet, Elisabeth, 2003. "Is a friend in need a friend indeed? Inclusion and exclusion in mutual insurance networks in southern Ghana," CUDARE Working Paper Series 978, University of California at Berkeley, Department of Agricultural and Resource Economics and Policy.
- Markus Goldstein & Elisabeth Sadoulet & Alain de Janvry, 2002. "Is a Friend in Need a Friend Indeed? Inclusion and Exclusion in Mutual Insurance Networks in Southern Ghana," STICERD - Development Economics Papers - From 2008 this series has been superseded by Economic Organisation and Public Policy Discussion Papers 32, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
- Goldstein, Markus & de Janvry, Alain & Sadoulet, Elisabeth, 2003. "Is a Friend in Need a Friend Indeed? Inclusion and Exclusion in Mutual Insurance Networks in Southern Ghana," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt0d89m20g, Department of Agricultural & Resource Economics, UC Berkeley.
- Markus Goldstein & Alan de Janvry & Elisabeth Sadoulet, 2002. "Is a friend in need a friend indeed? Inclusion and exclusion in mutual insurance networks in southern Ghana," LSE Research Online Documents on Economics 6647, London School of Economics and Political Science, LSE Library.
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- D1 - Microeconomics - - Household Behavior
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
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