Rainfall Forecasts, Weather, and Wages over the Agricultural Production Cycle
We look at the effects of rainfall forecasts and realized rainfall on equilibrium agricultural wages over the course of the agricultural production cycle. We show theoretically that a forecast of good weather can lower wages in the planting stage, by lowering ex ante out-migration, and can exacerbate the negative impact of adverse weather on harvest-stage wages. Using Indian household panel data describing early-season migration and district-level planting- and harvest-stage wages over the period 2005–2010, we find results consistent with the model, indicating that rainfall forecasts improve labor allocations on average but exacerbate wage volatility because they are imperfect.
Volume (Year): 104 (2014)
Issue (Month): 5 (May)
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Anjini Kochar, 1999. "Smoothing Consumption by Smoothing Income: Hours-of-Work Responses to Idiosyncratic Agricultural Shocks in Rural India," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 50-61, February.
- Seema Jayachandran, 2006.
"Selling Labor Low: Wage Responses to Productivity Shocks in Developing Countries,"
Journal of Political Economy,
University of Chicago Press, vol. 114(3), pages 538-575, June.
- Seema Jayachandran, 2005. "Selling Labor Low: Wage Responses to Productivity Shocks in Developing Countries," UCLA Economics Online Papers 370, UCLA Department of Economics.
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