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Smoothing Income against Crop Flood Losses in Amazonia: Rain Forest or Rivers as a Safety Net

  • Takasaki, Yoshito

    (U of Tsukuba)

  • Barham, Bradford L.

    (U of Wisconsin)

  • Coomes, Oliver T.

    (McGill U)

This article examines the role of ex post labor supply in smoothing income in response to crop losses caused by large floods among riverine households in the Peruvian Amazon, where rich environmental endowments permit a variety of resource extractive activities and coping responses. The paper finds that households respond to crop losses primarily by intensifying fishing effort not by relying on gathering of non-timber forest products, hunting, or asset liquidation. This ex post labor adjustment helps to smooth total income against small crop losses but less well against large crop losses. Both relatively non-poor households with better fishing capital and poor young households with a physical labor advantage employ this natural insurance in rivers.

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Paper provided by University of Wisconsin, Agricultural and Applied Economics in its series Staff Paper Series with number 518.

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Date of creation: Dec 2007
Date of revision:
Handle: RePEc:ecl:wisagr:518
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  1. Norgaard, Richard B., 1981. "Sociosystem and ecosystem coevolution in the amazon," Journal of Environmental Economics and Management, Elsevier, vol. 8(3), pages 238-254, September.
  2. Marcel Fafchamps & Chris Udry & Katherine Czukas, . "Drought and Saving in West Africa: Are Livestock a Buffer Stock?," Working Papers 97013, Stanford University, Department of Economics.
  3. Marcel Fafchamps & Susan Lund, . "Risk Sharing Networks in Rural Philippines," Working Papers 97014, Stanford University, Department of Economics.
  4. Lybbert, Travis J. & Barrett, Christopher B. & Desta, Solomon & Coppock, D. Layne, 2002. "Stochastic Wealth Dynamics And Risk Management Among A Poor Population," Working Papers 14736, Cornell University, Department of Applied Economics and Management.
  5. Fisher, Monica & Shively, Gerald, 2005. "Can Income Programs Reduce Tropical Forest Pressure? Income Shocks and Forest Use in Malawi," World Development, Elsevier, vol. 33(7), pages 1115-1128, July.
  6. Subhrendu K. Pattanayak & Erin O. Sills, 2001. "Do Tropical Forests Provide Natural Insurance? The Microeconomics of Non-Timber Forest Product Collection in the Brazilian Amazon," Land Economics, University of Wisconsin Press, vol. 77(4), pages 595-612.
  7. Delacote, Philippe, 2007. "Agricultural expansion, forest products as safety nets, and deforestation," Environment and Development Economics, Cambridge University Press, vol. 12(02), pages 235-249, April.
  8. Stefan Dercon, 1996. "Wealth, risk and activity choices: cattle in Western Tanzania," Economics Series Working Papers WPS/1996-08, University of Oxford, Department of Economics.
  9. John Hoddinott, 2006. "Shocks and their consequences across and within households in Rural Zimbabwe," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 301-321.
  10. Lisa A. Cameron & Christopher Worswick, 2003. "The Labor Market as a Smoothing Device: Labor Supply Responses to Crop Loss," Review of Development Economics, Wiley Blackwell, vol. 7(2), pages 327-341, 05.
  11. Udry, Christopher, 1995. "Risk and Saving in Northern Nigeria," American Economic Review, American Economic Association, vol. 85(5), pages 1287-1300, December.
  12. 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.
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