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Welfare impacts of climate shocks Evidence from Uganda










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    Welfare impacts of climate shocks: evidence from Tanzania 2016
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    Sub-Saharan Africa (SSA) remains the world’s most food-insecure region characterized by high levels of child mortality and poverty and low levels of human and physical capital (FAO, 2009). Countries in SSA, including Tanzania, heavily depend on a smallholder-based agricultural sector, which makes their welfare and food security particularly vulnerable to climate change (Barrios et al., 2008). The goal of this study is to provide a comprehensive analysis of the impact of weather risk on rural hou seholds’ welfare in Tanzania using nationally representative household panel data together with a set of novel weather variation indicators based on interpolated gridded and re-analysis weather data that capture the peculiar features of short term and long term variations in rainfall and temperature. In particular, we estimate the impact of weather shocks on a rich set of welfare indicators (including total income, total expenditure, food expenditure and its share in total expenditure and calori e intake) and investigate whether and how they vary by different definitions of shocks - capturing changes in levels and variations over different time periods. We find that both rainfall and maximum temperature variability exert a negative impact on welfare (i.e. no consumption smoothing) and that households that have adopted SLM practices are able to achieve income-smoothing. We also find that the most vulnerable rural households are much more affected by a rainfall deficit compared to the hou seholds in the top income quantile. Results underline the key role extension services play in enhancing adaptive capacity to reduce vulnerability to adverse weather conditions, as well as the importance of targeting the most vulnerable households in policy interventions to improve food security in the face of weather shocks.
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    How do extreme weather events affect livestock herders’ welfare? Evidence from Kyrgyzstan 2018
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    This paper examines the impact of the harsh 2012 winter on livestock herding households in Kyrgyzstan and identifies policy options to increase household resilience to such shocks. While existing studies mostly focus on rainfall shocks in tropical or dry climate areas, this analysis examines the exceptionally harsh winter that hit Kyrgyzstan in 2012, which resulted in the death of 25 000 animals. Using a unique household panel survey, merged with observed temperature data, the analysis finds that, on average, the negative effects of the winter shock on household welfare are significant and persistent over time, leading to a 5 percent and a 8 percent decrease in households’ food consumption expenditure in the short- (2011–2013) and medium-run (2011–2016), respectively. When disaggregating by income quantiles, the evidence shows that negative impact is concentrated in the upper quantiles of the welfare distribution. Several policy options are identified as effective in mitigating the negative welfare impacts of the weather shock. First, supporting households to restock their herds following weather shocks is found to significantly improve medium-term welfare by 10 percent relative to those that did not restock. Restocking efforts can be addressed in a holistic manner that takes into account immediate household needs, while simultaneously building long-term resilience in the livestock sector. This may include mitigating animal losses through the development of local forage markets that increase the availability of winter forage, combined with efforts to improve the genetic pool of livestock species through breeding programmes that select for resiliency traits. Second, results show that households living in regions with higher access to public veterinary services had significantly better welfare outcomes following the winter shock. Improvements of veterinary services and strengthening community-based organizations focusing on livestock and pasture development may help herding households to cope with weather shocks.
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    Combining Sustainable Agricultural Practices Pays Off: Evidence on Welfare Effects from Northern Ghana 2016
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    Sustainable Agricultural Practices (SAPs) are believed to play a vital role in addressing adverse effects of climate change and improving households’ welfare. While literature provides robust evidence on their welfare impacts in isolation, there is limited evidence on how combinations of SAPs contribute to households’ welfare. Due to complementarity and substitution effects and cost involved in adopting SAPs, combinations may have impacts that are higher or lower than individual effects. To shed light on this question, we investigate the adoption and impacts of SAPs on net crop income per acre and consumption expenditure per capita using a cross-sectional survey of 421 household and 1229 plots from northern Ghana. We employed a maximum simulated likelihood estimation of a Multinomial Endogenous Treatment Effect Model to account for observable and unobservable heterogeneity that influences SAPs adoption decisions and the outcome variables. As a departure from existing studies, our paper incorporated the effects of individual risk preferences, quantified using an experimental game with real payoffs, on the adoption and impacts of SAPs. Our results reveal that adoption decisions are affected by household and plot level characteristics including risk preferences of households. We find that adoption of SAPs significantly increase net crop income and consumption expenditure except when soil & water conservation is adopted in isolation.

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