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Market Participation, Weather Shocks and Welfare: Evidence from Malawi

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  • Asfaw, S.

Abstract

This paper explores the interaction between climate shocks, market regimes choices and welfare outcomes using Malawi's panel household data combined with long-term historical climate records. The study first examines how climate variability affects household market participation regime and then estimates the impact of market participation on several measure of household welfare. This study also provide a comprehensive picture of how market participation impacts household welfare in the wake of climate variability. The possibility for households to self-selection in a specific market regime is addressed through a multinomial endogenous treatment model. We find that rainfall variability is a push factor for Malawian household farmers who are more prone to participate in the market in order to guarantee their assets against the adverse effects of rainfall uncertainty. Furthermore, being a net seller is, on average, empirically associated with an increase in total and food consumption. The heterogeneity checks support the average results, in particular for female-headed households and large landowners. However, they also highlight that being net-sellers is associated with greater welfare only in Malawi s central region while in the northern and the southern regions, being net-buyer accrues a greater consumption. Furthermore, the net-sellers welfare superiority disappears in the wake of anomalous low rainfall events. Acknowledgement :

Suggested Citation

  • Asfaw, S., 2018. "Market Participation, Weather Shocks and Welfare: Evidence from Malawi," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277029, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae18:277029
    DOI: 10.22004/ag.econ.277029
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    4. MAMOUDOU Ba & Mazhar Mughal, 2022. "Weather Shocks, Coping Strategies and Household Well-being: Evidence from Rural Mauritania," Journal of Development Studies, Taylor & Francis Journals, vol. 58(3), pages 482-502, March.
    5. Kammas, Pantelis & Sakalis, Argyris & Sarantides, Vassilis, 2021. "Pudding, plague and education: trade and human capital formation in an agrarian economy," LSE Research Online Documents on Economics 112206, London School of Economics and Political Science, LSE Library.
    6. Mwale, Martin Limbikani & Kamninga, Tony Mwenda, 2022. "Land rights and the impact of farm input subsidies on poverty convergence," MPRA Paper 112431, University Library of Munich, Germany.
    7. Jeffrey D. Michler & Anna Josephson & Talip Kilic & Siobhan Murray, 2020. "Estimating the Impact of Weather on Agriculture," Papers 2012.11768, arXiv.org, revised Oct 2021.
    8. Mkandawire, Dingase & Gbegbelegbe, Sika Dofonsou & Yami, Mastewal & Nsenga, Justus & Kenamu, Edwin & Manyong, Victor & Abdoulaye, Tahirou & Alene, Arega & Bamba, Zoumana, 2021. "Analysing Urban and Peri-Urban Youth Employment in Agribusiness in Malawi: A Mixed Methods Approach," 2021 Conference, August 17-31, 2021, Virtual 315214, International Association of Agricultural Economists.
    9. Haddis Solomon & Yoko Kijima, 2022. "Does Land Certification Mitigate the Negative Impact of Weather Shocks? Evidence from Rural Ethiopia," Sustainability, MDPI, vol. 14(19), pages 1-17, October.
    10. Goli, Srinivas & Mavisakalyan, Astghik & Rammohan, Anu & Vu, Loan, 2022. "Conflicts and son preference: Micro-level evidence from 58 countries," Economics & Human Biology, Elsevier, vol. 46(C).
    11. Deißler, Luzia Karin & Krause, Henning & Grote, Ulrike, 2021. "Gender Dynamics and Food Security in the Kenyan African Indigenous Vegetables Supply Chain," 2021 Conference, August 17-31, 2021, Virtual 314983, International Association of Agricultural Economists.
    12. Feeny, Simon & Mishra, Ankita & Trinh, Trong-Anh & Ye, Longfeng & Zhu, Anna, 2021. "Early-Life exposure to rainfall shocks and gender gaps in employment: Findings from Vietnam," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 533-554.
    13. Jawoo Koo & Abdullah Mamun & Will Martin, 2021. "From bad to worse: Poverty impacts of food availability responses to weather shocks," Agricultural Economics, International Association of Agricultural Economists, vol. 52(5), pages 833-847, September.
    14. Amadu, Festus O. & McNamara, Paul E. & Miller, Daniel C., 2020. "Understanding the adoption of climate-smart agriculture: A farm-level typology with empirical evidence from southern Malawi," World Development, Elsevier, vol. 126(C).
    15. Leslie Lipper & Romina Cavatassi & Ricci Symons & Alashiya Gordes & Oliver Page, 2021. "Financing adaptation for resilient livelihoods under food system transformation: the role of Multilateral Development Banks," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 13(6), pages 1525-1540, December.
    16. Maggio, Giuseppe & Sitko, Nicholas, 2019. "Knowing is half the battle: Seasonal forecasts, adaptive cropping systems, and the mediating role of private markets in Zambia," Food Policy, Elsevier, vol. 89(C).
    17. Amadu, Festus O. & McNamara, Paul E. & Miller, Daniel C., 2020. "Yield effects of climate-smart agriculture aid investment in southern Malawi," Food Policy, Elsevier, vol. 92(C).
    18. Antonelli, Chiara & Coromaldi, Manuela & Pallante, Giacomo, 2022. "Crop and income diversification for rural adaptation: Insights from Ugandan panel data," Ecological Economics, Elsevier, vol. 195(C).
    19. Amolegbe, Khadijat Busola & Fontep, Eugenie Rose & Ahodode, Bernadin Géraud Comlan & Pagal, Emmanuelle Dorcas Mbanga & Ardelkrim, Araar, 2023. "Gendered Effects of Crop Diversification and Climate Shocks on Household Food Security Status in Nigeria," 97th Annual Conference, March 27-29, 2023, Warwick University, Coventry, UK 334551, Agricultural Economics Society - AES.

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