Transfers, Diversification and Household Risk Strategies: Can Productive Safety Nets Help Households Manage Climatic Variability?

2022/03/30 by Karen Macours, Patrick Premand, Patrick Prémand +1 · 8 citations
Agricultural and Biological Sciences · Social Sciences · Economics, Econometrics and Finance · #Agricultural risk and resilience #Poverty, Education, and Child Welfare #Microfinance and Financial Inclusion

paper · doi:10.1093/ej/ueac018

Abstract

Abstract We present experimental evidence on a programme aimed at improving households' risk management through income diversification. The intervention targeted rural Nicaraguan households exposed to weather variability and combined a one-year conditional cash transfer with vocational training or a productive investment grant. Both complementary interventions provided protection against weather shocks two years after the programme ended. Households that received the productive investment grant also had higher average consumption levels. The complementary interventions facilitated income smoothing and diversification of economic activities. Relaxing capital constraints induced investments in non-agricultural businesses, while relaxing skills constraints increased wage work and migration in response to shocks.

Cited by

• Leveraging social protection to strengthen Women’s and Girls’ Climate-Resilience in agrifood systems
• The Importance of Being Early? Anticipatory Cash Transfers for Flood-Affected Households
• Cash transfers relax climate-induced mobility constraints in Kenya
• The role of social assistance in African crises: a systematic literature review
• Sustainable Poverty Reduction through Social Assistance: Modality, Context, and Complementary Programming in Bangladesh
• Impact of crop commercialization on smallholder farmers’ resilience to shocks: Evidence from panel data for rural Southeast Asia
• Tackling psychosocial and capital constraints to alleviate poverty. [europepmc]
• How do policy measures affect the ability of poverty-stricken households to cope with external shocks? From the perspective of differences in the human capital endowment of households. [europepmc]

Related

• Climate Immobility Traps: A Household-Level Test
• Climate shocks, coping strategies, and household resilience: Evidence from a three‐wave panel in Malawi
• Linking development to climate adaptation: Leveraging generic and specific capacities to reduce vulnerability to drought in NE Brazil
• Cash transfers relax climate-induced mobility constraints in Kenya
• After the Drought: The Impact of Microinsurance on Consumption Smoothing and Asset Protection