Do floods induce long-term livelihood diversification? Evidence from Nigeria

Floods are among the most damaging climate-related shocks in low-and middle-income countries, but it remains unclear whether severe flood exposure induces households to diversify away from agriculture over the long term. This paper examines how flooding affects household livelihoods, labor allocation, and consumption in Nigeria using a nationally representative household panel spanning 2010-2019. We estimate impacts in a difference-in-differences framework that controls for predicted flood exposure and compare community-level flooding measured using survey reports of harmful flooding and a widely used database of satellite-detected inundation. Using survey-based flood exposure, we find persistent declines in consumption (12%) and agricultural production (17%) with no increase in non-farm enterprise labor or earnings. Wage employment rises only among households with prior wage work and without corresponding increases in wage earnings, while migration for work only increases after a delay of several years. In contrast, the satellite-based measure, constrained by low spatial resolution and high cloud cover during the flood period, identifies a substantially different set of flooded communities and suggests that flood exposure increases non-farm enterprise and total household earnings. These results imply that harmful flood exposure does not induce broad livelihood diversification in this setting, but that commonly-used flood exposure measures can lead to sharply different conclusions about climate adaptation responses.