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Shocks, sensitivity and resilience: tracking the economic impacts of environmental disaster on assets in Ethiopia and Honduras

Author

Listed:
  • Carter, Michael R.
  • Little, Peter D.
  • Mogues, Tewodaj
  • Negatu, Workneh

Abstract

"Droughts, hurricanes and other environmental shocks punctuate the lives of poor and vulnerable populations in many parts of the world. The direct impacts can be horrific, but what are the longer-term effects of such shocks on households and their livelihoods? Under what circumstances, and for what types of households, will shocks push households into poverty traps from which recovery is not possible? In an effort to answer these questions, this paper analyses the asset dynamics of Ethiopian and Honduran households in the wake of severe environmental shocks. While the patterns are different across countries, both reveal worlds in which the poorest households struggle most with shocks, adopting coping strategies which are costly in terms of both short term and long term well-being. There is some evidence that shocks threaten long term poverty traps and that they tend to militate against any tendency of the poor to catch up with wealthier households. Policy implications are discussed in terms of access to markets and the design of government safety net programs." Authors' Abstract

Suggested Citation

  • Carter, Michael R. & Little, Peter D. & Mogues, Tewodaj & Negatu, Workneh, 2006. "Shocks, sensitivity and resilience: tracking the economic impacts of environmental disaster on assets in Ethiopia and Honduras," DSGD discussion papers 32, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:dsgddp:32
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    References listed on IDEAS

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    1. Quisumbing, Agnes R., 2003. "Food Aid and Child Nutrition in Rural Ethiopia," World Development, Elsevier, vol. 31(7), pages 1309-1324, July.
    2. Fafchamps, Marcel & Udry, Christopher & Czukas, Katherine, 1998. "Drought and saving in West Africa: are livestock a buffer stock?," Journal of Development Economics, Elsevier, vol. 55(2), pages 273-305, April.
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    5. Dercon, Stefan, 1998. "Wealth, risk and activity choice: cattle in Western Tanzania," Journal of Development Economics, Elsevier, vol. 55(1), pages 1-42, February.
    6. Tewodaj Mogues & Michael Carter, 2005. "Social capital and the reproduction of economic inequality in polarized societies," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 3(3), pages 193-219, December.
    7. Mogues, Tewodaj & Carter, Michael R., 2004. "Social Capital And The Reproduction Of Inequality In Socially Polarized Economies," 2004 Annual meeting, August 1-4, Denver, CO 20132, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Ramón López & Alberto Valdés, 2000. "Fighting Rural Poverty in Latin America: New Evidence and Policy," Palgrave Macmillan Books, in: Ramón López & Alberto Valdés (ed.), Rural Poverty in Latin America, chapter 1, pages 1-31, Palgrave Macmillan.
    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. Tewodaj Mogues, 2005. "Shocks, Livestock Asset Dynamics, and Social Capital in Ethiopia," Development and Comp Systems 0512006, University Library of Munich, Germany.
    11. 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.
    12. Zimmerman, Frederick J. & Carter, Michael R., 2003. "Asset smoothing, consumption smoothing and the reproduction of inequality under risk and subsistence constraints," Journal of Development Economics, Elsevier, vol. 71(2), pages 233-260, August.
    13. Peter Little & M. Priscilla Stone & Tewodaj Mogues & A. Peter Castro & Workneh Negatu, 2006. "'Moving in place': Drought and poverty dynamics in South Wollo, Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 200-225.
    14. Ramón López & Alberto Valdés (ed.), 2000. "Rural Poverty in Latin America," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-333-97779-8.
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    Cited by:

    1. Romano, Donato & Ciani, Federico, 2014. "Testing for household resilience to food insecurity: evidence from Nicaragua," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182717, European Association of Agricultural Economists.
    2. Barnett, Barry J. & Barrett, Christopher B. & Skees, Jerry R., 2008. "Poverty Traps and Index-Based Risk Transfer Products," World Development, Elsevier, vol. 36(10), pages 1766-1785, October.
    3. Aboubakr Gambo Boukary & Adama Diaw & Tobias Wünscher, 2016. "Factors Affecting Rural Households’ Resilience to Food Insecurity in Niger," Sustainability, MDPI, vol. 8(3), pages 1-10, March.
    4. World Bank, 2008. "Ethiopia - A Country Study on the Economic Impacts of Climate Change," World Bank Publications - Reports 8030, The World Bank Group.
    5. Kebede, Sindu & Fekadu, Belay & Aredo, Dejene, 2011. "Trade Liberalization and Poverty: A Macro-Micro Analysis in Ethiopia," Proceedings of the German Development Economics Conference, Berlin 2011 44, Verein für Socialpolitik, Research Committee Development Economics.
    6. Rao, Sandeep & Koirala, Santosh & Thapa, Chandra & Neupane, Suman, 2022. "When rain matters! Investments and value relevance," Journal of Corporate Finance, Elsevier, vol. 73(C).
    7. Tewodaj Mogues, 2005. "Shocks, Livestock Asset Dynamics, and Social Capital in Ethiopia," Development and Comp Systems 0512006, University Library of Munich, Germany.
    8. Murendo, Conrad & Keil, Alwin & Zeller, Manfred, 2010. "Drought impacts and related risk management by smallholder farmers in developing countries: evidence from Awash River Basin, Ethiopia," Research in Development Economics and Policy (Discussion Paper Series) 114750, Universitaet Hohenheim, Department of Agricultural Economics and Social Sciences in the Tropics and Subtropics.
    9. Israel R. Orimoloye & Adeyemi O. Olusola & Johanes A. Belle & Chaitanya B. Pande & Olusola O. Ololade, 2022. "Drought disaster monitoring and land use dynamics: identification of drought drivers using regression-based algorithms," 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. 112(2), pages 1085-1106, June.
    10. Alejandro de la Fuente, 2007. "Climate Shocks and their Impact on Assets," Human Development Occasional Papers (1992-2007) HDOCPA-2007-23, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
    11. van den Berg, Marrit, 2010. "Household income strategies and natural disasters: Dynamic livelihoods in rural Nicaragua," Ecological Economics, Elsevier, vol. 69(3), pages 592-602, January.
    12. Jacques Christophe Diderot Julien, 2005. "Medición del impacto del huracán Mitch en el bienestar de los hogares de Nicaragua," Documentos CEDE 6736, Universidad de los Andes, Facultad de Economía, CEDE.
    13. World Bank, 2007. "Ethiopia - Accelerating Equitable Growth : Country Economic Memorandum, Part 2. Thematic Chapters," World Bank Publications - Reports 7866, The World Bank Group.
    14. Fisher, Monica & Chaudhury, Moushumi & McCusker, Brent, 2010. "Do Forests Help Rural Households Adapt to Climate Variability? Evidence from Southern Malawi," World Development, Elsevier, vol. 38(9), pages 1241-1250, September.

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    More about this item

    Keywords

    Environmental disasters; Economic situation; Impact evaluation; Droughts; Vulnerability; households; Livelihoods; Poverty; coping strategies; Safety nets; Government policy;
    All these keywords.

    JEL classification:

    • O - Economic Development, Innovation, Technological Change, and Growth
    • P - Political Economy and Comparative Economic Systems

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