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Working Paper 236 - Estimating Development Resilience: A Conditional Moments-Based Approach

Listed author(s):
  • Christopher Barrett
  • Cissé Jennifer Denno

    ()

Despite significant spending on ‘resilience’ by international development agencies, no theory-based method for estimating or measuring development resilience has yet been developed. This paper introduces an econometric strategy for estimating individual or household-level development resilience from panel data. Estimation of multiple conditional moments of a welfare function—itself specified to permit potentially nonlinear path dynamics— enables the computation and forecasting of individual-specific conditional probabilities of satisfying a normative minimum standard of living. We then develop a decomposable resilience measure that enables aggregation of the individualspecific estimates to targetable subpopulation- and population-level measures. We illustrate the method empirically using household panel data from pastoralist communities in northern Kenya. The results demonstrate not only the method and its potential for targeting resiliencebuilding interventions, but also help explain the behavioral paradox of apparent herd overstocking.

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Paper provided by African Development Bank in its series Working Paper Series with number 2340.

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Date of creation: 05 Jun 2016
Handle: RePEc:adb:adbwps:2340
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  1. Francisca Antman & David McKenzie, 2007. "Poverty traps and nonlinear income dynamics with measurement error and individual heterogeneity," Journal of Development Studies, Taylor & Francis Journals, vol. 43(6), pages 1057-1083.
  2. Terry Cannon & Detlef Müller-Mahn, 2010. "Vulnerability, resilience and development discourses in context of climate change," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 55(3), pages 621-635, December.
  3. Alfani, Federica & Dabalen, Andrew & Fisker, Peter & Molini, Vasco, 2015. "Can we measure resilience ? a proposed method and evidence from countries in the Sahel," Policy Research Working Paper Series 7170, The World Bank.
  4. Christiaensen, Luc J.M. & Boisvert, Richard N., 2000. "On Measuring Household Food Vulnerability: Case Evidence from Northern Mali," Working Papers 127676, Cornell University, Department of Applied Economics and Management.
  5. Cesar Calvo & Stefan Dercon, 2007. "Chronic Poverty and All That: The Measurement of Poverty over Time," CSAE Working Paper Series 2007-04, Centre for the Study of African Economies, University of Oxford.
  6. Christophe Béné & Andrew Newsham & Mark Davies & Martina Ulrichs & Rachel Godfrey‐Wood, 2014. "Review Article: Resilience, Poverty And Development," Journal of International Development, John Wiley & Sons, Ltd., vol. 26(5), pages 598-623, 07.
  7. Christopher Barrett & Paswel Phiri Marenya & John Mcpeak & Bart Minten & Festus Murithi & Willis Oluoch-Kosura & Frank Place & Jean Claude Randrianarisoa & Jhon Rasambainarivo & Justine Wangila, 2006. "Welfare dynamics in rural Kenya and Madagascar," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 248-277.
  8. Michael Carter & Christopher Barrett, 2006. "The economics of poverty traps and persistent poverty: An asset-based approach," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 178-199.
  9. Christopher B. Barrett & Michael R. Carter, 2013. "The Economics of Poverty Traps and Persistent Poverty: Empirical and Policy Implications," Journal of Development Studies, Taylor & Francis Journals, vol. 49(7), pages 976-990, July.
  10. Sommarat Chantarat & Andrew G. Mude & Christopher B. Barrett & Michael R. Carter, 2013. "Designing Index-Based Livestock Insurance for Managing Asset Risk in Northern Kenya," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 80(1), pages 205-237, 03.
  11. Andy McKay & Emilie Perge, 2013. "How Strong is the Evidence for the Existence of Poverty Traps? A Multicountry Assessment," Journal of Development Studies, Taylor & Francis Journals, vol. 49(7), pages 877-897, July.
  12. Michelle Adato & Michael Carter & Julian May, 2006. "Exploring poverty traps and social exclusion in South Africa using qualitative and quantitative data," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 226-247.
  13. Antle, John M, 1983. "Testing the Stochastic Structure of Production: A Flexible Moment-based Approach," Journal of Business & Economic Statistics, American Statistical Association, vol. 1(3), pages 192-201, July.
  14. Stanislav Kolenikov, 2010. "Resampling variance estimation for complex survey data," Stata Journal, StataCorp LP, vol. 10(2), pages 165-199, June.
  15. A. Colin Cameron & Pravin K. Trivedi, 2010. "Microeconometrics Using Stata, Revised Edition," Stata Press books, StataCorp LP, number musr, January.
  16. Jonathan Haughton & Shahidur R. Khandker, 2009. "Handbook on Poverty and Inequality," World Bank Publications, The World Bank, number 11985, September.
  17. Travis J. Lybbert & Christopher B. Barrett & Solomon Desta & D. Layne Coppock, 2004. "Stochastic wealth dynamics and risk management among a poor population," Economic Journal, Royal Economic Society, vol. 114(498), pages 750-777, October.
  18. Felix Naschold, 2013. "Welfare Dynamics in Pakistan and Ethiopia -- Does the Estimation Method Matter?," Journal of Development Studies, Taylor & Francis Journals, vol. 49(7), pages 936-954, July.
  19. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-231, March.
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