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Drought and Saving in West Africa: Are Livestock a Buffer Stock?

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Author Info
Marcel Fafchamps
Chris Udry
Katherine Czukas

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Abstract

Households in the west African semi-arid tropics face substantial risk -- an inevitable consequence of engaging in rainfed agriculture in a drought-prone environment. It has long been hypothesized that these households keep livestock as a buffer stock to insulate their consumption from income fluctuations income. This paper tests this hypothesis. Results indicate that livestock transactions play less of a consumption smoothing role than often assumed. Livestock sales compensate for at most thirty percent, and probably closer to twenty percent of income shortfalls due to village-level shocks alone. We discuss possible explanations for these results and suggest directions for future work.

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Paper provided by Stanford University, Department of Economics in its series Working Papers with number 97013.

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Handle: RePEc:wop:stanec:97013

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This page was last updated on 2009-10-31.


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