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Rainfall variability, occupational choice, and welfare in rural Bangladesh

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  • Sushenjit Bandyopadhyay
  • Emmanuel Skoufias

Abstract

The determinants of occupational focus versus diversification between household members in rural Bangladesh are investigated as an autonomous and proactive adaptation strategy against ex ante local rainfall variability risks. Nationally representative household level survey data are combined with historical climate variability information at the Upazila level. Flood prone Upazilas are distinguished from non-flood prone Upazilas, since the latter may be susceptible to higher risks from local rainfall variability. Adult members of the same household are found to be less likely than the household head to be self-employed in agriculture in areas with high local rainfall variability. Moreover, it is shown that occupational diversification comes at a cost in terms of lower household-level welfare (consumption). The effects of three policy actions, such as access to credits, safety net, and markets are considered. Access to market appears to be more effective in reducing the likelihood of costly within household occupational diversification as an ex ante climate risk reducing strategy as compared to access to credit and safety nets. Copyright Springer Science+Business Media New York 2015

Suggested Citation

  • Sushenjit Bandyopadhyay & Emmanuel Skoufias, 2015. "Rainfall variability, occupational choice, and welfare in rural Bangladesh," Review of Economics of the Household, Springer, vol. 13(3), pages 589-634, September.
    • Handle: RePEc:kap:reveho:v:13:y:2015:i:3:p:589-634
    DOI: 10.1007/s11150-013-9203-z
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    1. Ajay Shenoy, 2018. "Risky Income or Lumpy Investments? Evidence on Two Theories of Underspecialization," Economic Development and Cultural Change, University of Chicago Press, vol. 66(4), pages 629-671.
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    3. Martin Rama & Tara Béteille & Yue Li & Pradeep K. Mitra & John Lincoln Newman, 2015. "Addressing Inequality in South Asia," World Bank Publications - Books, The World Bank Group, number 20395, December.
    4. Mohammad Saiful Islam & Abu Hayat Md. Saiful Islam & Masayuki Sato, 2023. "Nexus between climatic extremes and household expenditures in rural Bangladesh: a nationally representative panel data analysis," Asia-Pacific Journal of Regional Science, Springer, vol. 7(2), pages 355-379, June.
    5. Martey, Edward & Etwire, Prince M. & Mockshell, Jonathan & Armah, Ralph & Akorsikumah, Eli, 2023. "Ecological shocks and children’s school attendance and farm work in Ghana," World Development Perspectives, Elsevier, vol. 31(C).
    6. M. Shahe Emran & Asadul Islam & Forhad Shilpi, 2020. "Distributional Effects of Corruption When Enforcement is Biased: Theory and Evidence from Bribery in Schools in Bangladesh," Economica, London School of Economics and Political Science, vol. 87(348), pages 985-1015, October.
    7. Beyer,Robert Carl Michael & Narayanan,Abhinav & Thakur,Gogol Mitra, 2022. "Natural Disasters and Economic Dynamics : Evidence from the Kerala Floods," Policy Research Working Paper Series 10084, The World Bank.
    8. Tiziana Pagnani & Elisabetta Gotor & Francesco Caracciolo, 2021. "Adaptive strategies enhance smallholders’ livelihood resilience in Bihar, India," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 13(2), pages 419-437, April.
    9. Emran, M. Shahe & Shilpi, Forhad, 2018. "Beyond dualism: Agricultural productivity, small towns, and structural change in Bangladesh," World Development, Elsevier, vol. 107(C), pages 264-276.
    10. Francesca Marchetta & David E. Sahn & Luca Tiberti, 2018. "School or work?The role of weather shocks in Madagascar," Cahiers de recherche CREATE 2018-2, CREATE.
    11. Shaikh M. S. U. Eskander & Edward B. Barbier, 2023. "Adaptation to Natural Disasters through the Agricultural Land Rental Market: Evidence from Bangladesh," Land Economics, University of Wisconsin Press, vol. 99(1), pages 141-160.
    12. Narloch, Ulf & Bangalore, Mook, 2018. "The multifaceted relationship between environmental risks and poverty: new insights from Vietnam," LSE Research Online Documents on Economics 87553, London School of Economics and Political Science, LSE Library.
    13. Karim, Azreen, 2016. "The household response to persistent natural disasters: Evidence from Bangladesh," Working Paper Series 4968, Victoria University of Wellington, School of Economics and Finance.
    14. Call, Maia & Gray, Clark & Jagger, Pamela, 2019. "Smallholder responses to climate anomalies in rural Uganda," World Development, Elsevier, vol. 115(C), pages 132-144.
    15. Emran, Shahe & Shilpi, Forhad, 2018. "Agricultural Productivity, Hired Labor, Wages, and Poverty: Evidence from Bangladesh," World Development, Elsevier, vol. 109(C), pages 470-482.
    16. Gulesci, Selim & Battaglia, Marianna & Madestam, Andreas, 2018. "Repayment Flexibility and Risk Taking: Experimental Evidence from Credit Contracts," CEPR Discussion Papers 13329, C.E.P.R. Discussion Papers.
    17. Amare, M. & Waibel, H., 2015. "Climate Variability, Shocks and Non-farm Employment: Evidence from Rural Household in Northeast Thailand," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 50, March.
    18. Emmanuel Skoufias & Sushenjit Bandyopadhyay & Sergio Olivieri, 2017. "Occupational diversification as an adaptation to rainfall variability in rural India," Agricultural Economics, International Association of Agricultural Economists, vol. 48(1), pages 77-89, January.
    19. World Bank, 2013. "Bangladesh - Poverty Assessment : Assessing a Decade of Progress in Reducing Poverty, 2000-2010," World Bank Publications - Reports 16622, The World Bank Group.
    20. Azreen Karim & Ilan Noy, 2016. "Poverty And Natural Disasters — A Qualitative Survey Of The Empirical Literature," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 61(01), pages 1-36, March.
    21. Karim, Azreen, 2018. "The Household Response to Persistent Natural Disasters: Evidence from Bangladesh," World Development, Elsevier, vol. 103(C), pages 40-59.
    22. Pace, Noemi & Sebastian, Ashwini & Daidone, Silvio & Dela O Campos, Ana Paula & Prifti, Ervin & Davis, Benjamin, 2022. "Cash transfers’ role in improving livelihood diversification strategies and well-being: short- and medium-term evidence from Zimbabwe," World Development, Elsevier, vol. 154(C).
    23. Karim, Azreen & Noy, Ilan, 2020. "Risk, poverty or politics? The determinants of subnational public spending allocation for adaptive disaster risk reduction in Bangladesh," World Development, Elsevier, vol. 129(C).
    24. Amare, Mulubrhan & Waibel, Herman, 2014. "Climate Variability, Shocks and Non-farm Employment: Evidence from Rural Households in Northeast Thailand," 54th Annual Conference, Goettingen, Germany, September 17-19, 2014 187571, German Association of Agricultural Economists (GEWISOLA).

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    More about this item

    Keywords

    Climate variability; Rural occupation; Welfare; Bangladesh; Q54; J43; O12;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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