IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v136y2019icp119-136.html
   My bibliography  Save this article

Long-lasting income shocks and adaptations: Evidence from coral bleaching in Indonesia

Author

Listed:
  • Chaijaroen, Pasita

Abstract

This paper explores how people adapt to climate shocks, specifically coral bleaching, that have long-lasting impacts on income. Caused mainly by abnormally high sea surface temperature, coral bleaching has significant effects on marine resources. Using panel data from Indonesia and exogenous variations in bleaching, I observe that fishery households in affected areas experienced a decrease in income relative to other households. Although consumption expenditures did not decline significantly in response to these income shocks, these households reduced their protein consumption in the short and long runs. Regarding labor market outcomes, the affected households tended to substantially increase their labor supply and switch industries only in the long run.

Suggested Citation

  • Chaijaroen, Pasita, 2019. "Long-lasting income shocks and adaptations: Evidence from coral bleaching in Indonesia," Journal of Development Economics, Elsevier, vol. 136(C), pages 119-136.
    • Handle: RePEc:eee:deveco:v:136:y:2019:i:c:p:119-136
    DOI: 10.1016/j.jdeveco.2018.10.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304387818305169
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jdeveco.2018.10.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Subramanian, Shankar & Deaton, Angus, 1996. "The Demand for Food and Calories," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 133-162, February.
    2. Wolfram Schlenker & W. Michael Hanemann & Anthony C. Fisher, 2006. "The Impact of Global Warming on U.S. Agriculture: An Econometric Analysis of Optimal Growing Conditions," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 113-125, February.
    3. Townsend, Robert M, 1994. "Risk and Insurance in Village India," Econometrica, Econometric Society, vol. 62(3), pages 539-591, May.
    4. Wolpin, Kenneth I, 1982. "A New Test of the Permanent Income Hypothesis: The Impact of Weather on the Income and Consumption of Farm Households in India," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 23(3), pages 583-594, October.
    5. Rose, Elaina, 2001. "Ex ante and ex post labor supply response to risk in a low-income area," Journal of Development Economics, Elsevier, vol. 64(2), pages 371-388, April.
    6. Emmanuel Skoufias & Sailesh Tiwari & Hassan Zaman, 2012. "Crises, Food Prices, and the Income Elasticity of Micronutrients: Estimates from Indonesia," The World Bank Economic Review, World Bank, vol. 26(3), pages 415-442.
    7. Melissa Dell & Benjamin F. Jones & Benjamin A. Olken, 2014. "What Do We Learn from the Weather? The New Climate-Economy Literature," Journal of Economic Literature, American Economic Association, vol. 52(3), pages 740-798, September.
    8. Solomon M. Hsiang & Amir S. Jina, 2014. "The Causal Effect of Environmental Catastrophe on Long-Run Economic Growth: Evidence From 6,700 Cyclones," NBER Working Papers 20352, National Bureau of Economic Research, Inc.
    9. Paxson, Christina H, 1993. "Consumption and Income Seasonality in Thailand," Journal of Political Economy, University of Chicago Press, vol. 101(1), pages 39-72, February.
    10. Nicholas A. J. Graham & Simon Jennings & M. Aaron MacNeil & David Mouillot & Shaun K. Wilson, 2015. "Predicting climate-driven regime shifts versus rebound potential in coral reefs," Nature, Nature, vol. 518(7537), pages 94-97, February.
    11. Taraz, Vis, 2017. "Adaptation to climate change: historical evidence from the Indian monsoon," Environment and Development Economics, Cambridge University Press, vol. 22(5), pages 517-545, October.
    12. Olivier Deschênes & Michael Greenstone, 2012. "The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather: Reply," American Economic Review, American Economic Association, vol. 102(7), pages 3761-3773, December.
    13. 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.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hoang, Trung Xuan & Le, Duong Trung & Nguyen, Ha Minh & Vuong, Nguyen Dinh Tuan, 2020. "Labor market impacts and responses: The economic consequences of a marine environmental disaster," Journal of Development Economics, Elsevier, vol. 147(C).
    2. Yamamoto, Yuki, 2023. "Living under ecosystem degradation: Evidence from the mangrove–fishery linkage in Indonesia," Journal of Environmental Economics and Management, Elsevier, vol. 118(C).
    3. Katrina Kosec & Jie Song, 2021. "The effects of income fluctuations on undernutrition and overnutrition across the lifecycle," Health Economics, John Wiley & Sons, Ltd., vol. 30(10), pages 2487-2509, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luigi Minale, 2018. "Agricultural productivity shocks, labour reallocation and rural–urban migration in China," Journal of Economic Geography, Oxford University Press, vol. 18(4), pages 795-821.
    2. Andrew Dillon & Valerie Mueller & Sheu Salau, 2011. "Migratory Responses to Agricultural Risk in Northern Nigeria," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(4), pages 1048-1061.
    3. Afridi, Farzana & Mahajan, Kanika & Sangwan, Nikita, 2022. "The gendered effects of droughts: Production shocks and labor response in agriculture," Labour Economics, Elsevier, vol. 78(C).
    4. Gaurav, Sarthak, 2015. "Are Rainfed Agricultural Households Insured? Evidence from Five Villages in Vidarbha, India," World Development, Elsevier, vol. 66(C), pages 719-736.
    5. Dubois, Pierre, 2002. "Consommation, partage de risque et assurance informelle : développements théoriques et tests empiriques récents," L'Actualité Economique, Société Canadienne de Science Economique, vol. 78(1), pages 115-149, Mars.
    6. Afridi, Farzana & Mahajan, Kanika & Sangwan, Nikita, 2021. "The Gendered Effects of Climate Change: Production Shocks and Labor Response in Agriculture," IZA Discussion Papers 14568, Institute of Labor Economics (IZA).
    7. van den Berg, Marrit & Burger, Kees, 2008. "Household Consumption and Natural Disasters: The Case of Hurricane Mitch in Nicaragua," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44380, European Association of Agricultural Economists.
    8. Jonathan Colmer, 2013. "Climate Variability, Child Labour and Schooling: Evidence on the Intensive and Extensive Margin," GRI Working Papers 132, Grantham Research Institute on Climate Change and the Environment.
    9. Yun, Seong Do & Gramig, Benjamin M & Delgado, Michael S. & Florax, Raymond J.G.M., 2015. "Does Spatial Correlation Matter in Econometric Models of Crop Yield Response and Weather?," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205465, Agricultural and Applied Economics Association.
    10. Kaixing Huang, 2015. "The Economic Impacts of Global Warming on Agriculture: the Role of Adaptation," School of Economics and Public Policy Working Papers 2015-20, University of Adelaide, School of Economics and Public Policy.
    11. Severen, Christopher & Costello, Christopher & Deschênes, Olivier, 2018. "A Forward-Looking Ricardian Approach: Do land markets capitalize climate change forecasts?," Journal of Environmental Economics and Management, Elsevier, vol. 89(C), pages 235-254.
    12. Martina Kirchberger, 2014. "Natural Disasters and Labour Markets," Economics Series Working Papers WPS/2014-19, University of Oxford, Department of Economics.
    13. Idriss Fontaine & Sabine Garabedian & David Nortes Martínez & Hélène Vérèmes, 2021. "Tropical Cyclones and Fertility : New Evidence from Madagascar," Working Papers hal-03243455, HAL.
    14. Masahiro Shoji, 2008. "How do the poor cope with hardships when mutual assistance is unavailable?," Economics Bulletin, AccessEcon, vol. 15(13), pages 1-17.
    15. Mangyo, Eiji, 2008. "Who benefits more from higher household consumption? The intra-household allocation of nutrients in China," Journal of Development Economics, Elsevier, vol. 86(2), pages 296-312, June.
    16. Bhaskar Jyoti Neog, 2022. "Temperature shocks and rural labour markets: evidence from India," Climatic Change, Springer, vol. 171(1), pages 1-20, March.
    17. Carpena, Fenella, 2019. "How do droughts impact household food consumption and nutritional intake? A study of rural India," World Development, Elsevier, vol. 122(C), pages 349-369.
    18. Sekhri, Sheetal & Storeygard, Adam, 2014. "Dowry deaths: Response to weather variability in India," Journal of Development Economics, Elsevier, vol. 111(C), pages 212-223.
    19. Rose, Elaina, 2001. "Ex ante and ex post labor supply response to risk in a low-income area," Journal of Development Economics, Elsevier, vol. 64(2), pages 371-388, April.
    20. Anita Mukherjee & Shawn Cole & Jeremy Tobacman, 2021. "Targeting weather insurance markets," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 88(3), pages 757-784, September.

    More about this item

    Keywords

    Coral bleaching; Long-term income shock; Labor supply; Consumption; Climate change;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:136:y:2019:i:c:p:119-136. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/devec .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.