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Vulnerability of Household Consumption to Village-level Aggregate Shocks in a Developing Country

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  • Kurosaki, Takashi

Abstract

This paper examines which households are more vulnerable when a village is hit by natural disasters. We propose a methodology to infer the theoretical mechanisms underlying the heterogeneity of household vulnerability, focusing on the difference between the across-household-type difference in marginal response to aggregate shocks and that in marginal response to idiosyncratic shocks. Empirical results using two-period panel data from rural Pakistan show that the sensitivity of consumption changes to shocks indeed differs across household types and the patterns of difference can be explained by the coexistence of unequal access to credit and risk sharing among heterogeneously risk-averse households.

Suggested Citation

  • Kurosaki, Takashi, 2011. "Vulnerability of Household Consumption to Village-level Aggregate Shocks in a Developing Country," 2011 ASAE 7th International Conference, October 13-15, Hanoi, Vietnam 290609, Asian Society of Agricultural Economists (ASAE).
    • Handle: RePEc:ags:asae11:290609
    DOI: 10.22004/ag.econ.290609
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    Cited by:

    1. Gaurav, Sarthak, 2015. "Are Rainfed Agricultural Households Insured? Evidence from Five Villages in Vidarbha, India," World Development, Elsevier, vol. 66(C), pages 719-736.
    2. Fujie, Takeshi & Senda, Tetsuji, 2019. "Effects of Aggregate Shocks on the Productivity of Farm Households in Prewar Japan," Japanese Journal of Agricultural Economics (formerly Japanese Journal of Rural Economics), Agricultural Economics Society of Japan (AESJ), vol. 21.

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