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People in developing economies face substantial income risks and use diverse strategies to mitigate the negative welfare impact. Rural households often send migrants to diversify income sources and depend on remittances to cope with income risks. To examine the risk-coping mechanism of urban migrants and their rural families against the aggregate shock due to the COVID-19 pandemic, we analyze the seven-round Bangladeshi household panel covering the period before and after the first implementation of COVID-19 lockdown policies. Our event study finds that urban migrants experienced more substantial income loss than their rural families and reduced but not ceased remittances to cope with the aggregate shock jointly. Notably, mobile money services allowed them to continue sending remittances even under the lockdown policies., JSPS KAKENHI (Grant Numbers: JP18J20988, JP18H00838), The Telecommunications Advancement Foundation, The Mitsubishi Foundation, The Kikawada Foundation, The Zengin Foundation for Studies on Economics and Finance, The Yamada Foundation, The Nihon Housei Gakkai, Japan Center for Economic Research

This paper illustrates the sharp contrast in welfare impacts between the rich and the poor caused by typhoon Milenyo in a Philippine village. We find that fish prices dropped sharply due to the damage caused to fish pens near the village, leading to positive net welfare gains among the wealthy. In contrast , the poor do not consume much fish and thus did not gain from the sharp decline in prices. Finally, co nsumption reallocation played an important role as an ex post risk coping measure, albeit only among the wealthy, who are relatively well protected against typhoons., Embargo Period 24 months, http://www.grips.ac.jp/list/jp/facultyinfo/estudillo_jonna/

Most countries around the world implement some form of a safety net program for poor households. A widespread concern is that such programs crowd out private-sector jobs. But they could also improve workers' welfare by allowing them to take on more risk, for example through self-employment. This paper analyzes the employment impacts of the world's largest public-works program using a novel regression-discontinuity design. The analysis exploits detailed institutional information to describe the allocation formula of the program and to construct a benefit calculator that predicts early and late treatment of districts. The results show that there is little evidence of a crowding out of private-sector jobs. Instead, the scheme functions as a safety net after a bad rainfall shock. Male workers also take on more risk by moving into family employment. This self-revealed preference for a different type of job suggests other potential benefits of safety net programs which so far have received little attention in the literature.

Almost all the studies about place attachment in environmental risk contexts only consider the role of place attachment to home or local area. However, especially when it comes to risks requiring evacuation from home and local area, it is likely that place attachment to evacuation sites, if any, becomes relevant too. The present studies intend to understand how place attachment to evacuation sites affects coping behaviors in natural hazard contexts. A first study (N = 184) investigates how place attachment predicts intention to evacuate on the tsunami-prone Chilean coast. Evacuation site place attachment is found to improve intention to evacuate prediction, after controlling for the traditional cognitive antecedents of intention to evacuate. Two experimental studies subsequently test the role of evacuation site place attachment in imaginary environmental risk contexts. The second study (N = 115) finds that participants would rather go to an affectively significant evacuation site rather than to anon-affectively significant one, when asked to choose. The third study (N = 81) finds an effect of evacuation site place attachment on intention to evacuate. It is concluded that evacuation site place attachment could play a relevant role in time of evacuation Theoretical and practical implications for policy making are discussed, as well as the need for further studies.

In the wake of climate change, there is now a resurgence of interest in the promotion of crop diversification as a climate smart agricultural practice in Sub-Saharan Africa. The development economics literature suggests that increasing crop diversity is an effective risk management and consumption smoothing strategy in a context characterized by repeated exposure to shocks but weak institutional innovations. Using panel survey data from rural Uganda merged with historical weather data, this paper sheds light on the household welfare and consumption smoothing effects of crop diversity. We employ instrumental variables methods to control for unobserved heterogeneity and potential reverse causality. Our study finds that crop diversification is a welfare enhancing strategy that increases consumption and aggregate household diets. Instrumental variables quantile regression results show that crop diversification generates higher consumption benefits for poorest households in the lower quantile of the consumption distribution than for relatively richer households. Crop diversification also improves consumption smoothing through reducing households’ reliance on less effective strategies such as informal insurance and involuntary diet changes as risk coping mechanisms. Overall, the findings suggest that transforming agriculture towards a more diversified cropping system is a viable pathway for improving diets, welfare, risk management and the resilience of rural households.

International audience; This paper contributes to an emerging literature on the relationship between free exchange of land use rights and risk-coping motives in developing countries. We argue that in-depth empirical analysis of the nature of land arrangements is crucial to understand risk-coping motives in landtenure. Using mixed quantitative and qualitative data collected in Thailand, the paper proposes an innovative framework which looks at transfers of use rights in a continuum from pure market to free exchange. Land transfers are categorized along three dimensions: the nature of the relationshipbetween the parties involved, the nature of the payment made, and how explicit the payment is in the contractual terms. The economic motivations in each of the consequent categories of land arrangement are then analyzed with a multinomial probit. Our main results suggest that while free loans of land are allegedly common practice in Thailand, only a small number of those transfers are really free. Most appear to be a `disguised form of rental contract' set by households who rely heavily on their risk-sharing network for risk-coping, and hold property rights vulnerable to family claims despite the presence of formal titles. Our preliminary results also confirm what the literature has previously shown: when confronted with local social norms and the economic rationales created by multimarket failures, a sound formal property rights system proves non- sufficient to establish de facto formal property rights.

Little is known about how place attachment affects natural hazard risk perception and coping. A systematic search of social science databases revealed 31 works (1996–2016) that directly address place attachment in relation to natural hazard risk or natural environmental risks (seismic, volcanic, etc.). Across different contexts, the research shows: (a) both positive and negative relations between place attachment and natural environmental risk perception; (b) both positive and negative relations between place attachment and risk coping; and (c) mediating and moderating relations. In particular, results show that: (a) strongly attached individuals perceive natural environmental risks but underestimate their potential effects; (b) strongly attached individuals are unwilling to relocate when facing natural environmental risks and are more likely to return to risky areas after a natural environmental disaster; (c) place attachment acts both as a mediating and moderating variable between risk perception and coping. Place attachment should play a more significant role in natural hazard risk management.

The Pacific island countries (PICs) are some of the most exposed to frequent natural disasters and climate shocks, and their vulnerability is increasing due to mounting effects of climate change as well as demographic and economic forces. Natural disasters hit the poorest hardest and have long-term consequences for human development. Social protection programs and systems have an important role in helping poor and vulnerable populations cope with the impacts of shocks as well as build long-term resilience. This paper discusses the potential role of social protection for disaster and climate risk reduction and management in PICs. It presents evidence and lessons from other regions, providing examples of tools and entry points for the development of climate, and disaster, responsive social protection interventions and context-specific recommendations for PICs.

Social protection can help build people’s social and economic resilience against disasters in Myanmar. Regular cash transfers, including public works programs, can help smooth consumption,build and maintain assets, and develop human capital to better cope with natural hazards. Disaster risk management (DRM) systems can be linked to social protection programs to trigger a safetynet response in times of emergencies. Community-driven development (CDD) programs could provide a useful platform for social protection programming to respond to disasters and build long termresilience in Myanmar.

This study aims to examine the status quo of risk perception and risk coping of citizen, as well as the relationship between risk perception and risk coping with the data of questionnaire survey. Nine risks which would be happened in everyday life were presented ', strong earthquake, traffic accident, plunge in stock price or interest rate, dioxin, cancer, consumer damage on the Internet, defamation on the Internet, Internet stalking, and computer virus. As the results, it was found that citizens with low self-help consciousness and low information-taking tendency tend to feel the unknown and the dread of risk. This result has brought new objects, i.e. the possibility and necessity of the change of people's consciousness and attitude should be considered.

Uncertainty and unpredictability faced by low-income households increase their vulnerability making poverty even more unbearable. India¡¦s National Bank for Agriculture and Rural Development (NABARD)-initiated Self-Help Group (SHG) program, which is currently the largest and fastest growing microfinance program in the developing world, has been aggressively promoted as a way of combating poverty. This paper investigates whether or not SHG participation results in reducing poverty and vulnerability. A theoretical framework is developed to examine the mechanisms through which the pecuniary and non-pecuniary effects of the SHG program on the beneficiaries¡¦ earnings and empowerment, influence their households¡¦ ability to manage risk. Going beyond the traditional poverty estimates, we use a vulnerability measure which quantifies the welfare loss associated with poverty as well as different types of risks like aggregate and idiosyncratic risks. Applying this measure to an Indian panel survey data for 2000 and 200ƒ£, we find that SHG members have lower vulnerability as compared to a group of non-SHG (control) members. Furthermore, we find that the poverty contributes to about 80 percent of the vulnerability faced by the household followed by aggregate risk.

Uncertainty and unpredictability faced by low-income households increase their vulnerability making poverty even more unbearable. India’s National Bank for Agriculture and Rural Development (NABARD)-initiated Self-Help Group (SHG) program, which is currently the largest and fastest growing microfinance program in the developing world, has been aggressively promoted as a way of combating poverty. This paper investigates whether or not SHG participation results in reducing poverty and vulnerability. A theoretical framework is developed to examine the mechanisms through which the pecuniary and non-pecuniary effects of the SHG program on the beneficiaries’ earnings and empowerment, influence their households’ ability to manage risk. Going beyond the traditional poverty estimates, we use a vulnerability measure which quantifies the welfare loss associated with poverty as well as different types of risks like aggregate and idiosyncratic risks. Applying this measure to an Indian panel survey data for 2000 and 2003, we find that SHG members have lower vulnerability as compared to a group of non-SHG (control) members. Furthermore, we find that the poverty contributes to about 80 percent of the vulnerability faced by the household followed by aggregate risk.

Rural and urban households in developing countries face substantial idiosyncratic and common risk, resulting in high income variability. Households in risky environments have developed sophisticated (ex-ante) risk-management and (ex-post) risk-coping strategies, including self-insurance via savings and informal insurance mechanisms to do so while formal credit and insurance markets appear to contribute only little to reducing income risk and its consequences. Informal credit and insurance, however incomplete, helps to cope with risky incomes. Despite these strategies, vulnerability remains high, and is reflected in fluctuations in consumption. It is clear therefore, that further development of safety nets will be necessary. In this paper, we focus on the opportunities available to households to use risk-management and risk-coping strategies, and on the constraints on their effectiveness. Fluctuations in consumption usually imply relatively high levels of transient poverty. High income risk may also be a cause of persistent poverty. The failure to cope with income risk is not only reflected in household consumption fluctuations but affect nutrition, health and education and contribute to inefficient and unequal intrahousehold allocations. Deaton’s model provides a useful description of the advantages of self-insurance. Policy conclusions may be limited however. In practice, assets are risky, not safe. The covariance of asset values and income due to common shocks makes self-insurance a far less useful strategy than it seems. We quantify the consequences of holding risky assets that are covariate with incomes, using simulations. Access to relatively safe and profitable assets, which might be useful for consumption smoothing, may also be limited. Lumpiness in assets may be a reason why the poor cannot protect themselves easily via assets. Policies that influence asset market risks could be beneficial to households attempting to deal with shocks. Policies could include providing more attractive and diversified savings instruments. Microfinance initiatives should put savings for self-insurance on the agenda. Macroeconomic stability during income downturns would also allow self-insurance to function better. Income smoothing can be achieved by income portfolio adjustments. In practice relatively little income smoothing (even via income portfolio adjustments) is achieved by poorer households. Income diversification for effective risk-reduction appears limited. Observed diversification patterns are often not aimed at reducing risk. Households face entry constraints to enter into profitable activities. Income risk reduction often comes at a cost. Income skewing is likely if less protection is offered by investing in assets. The long-term consequences for the asset-poor are lower average incomes and a higher income gap relative to asset-rich households. Observing specialisation does not necessarily imply that the household follows a high-risk strategy. Also, entry constraints may limit the diversification that can be achieved, leaving only low-return activities free to the poor. Income portfolios must be seen in relation to the asset portfolio and other options available: a risky, specialised portfolio may mean lower consumption risk than a diversified portfolio, depending on the asset position. Finally, several income-based strategies are only be invoked when a crisis looms. These (income)‘coping’ or ‘survival’ strategies are especially important when the shock is economy-wide. There has been increasing interest in the empirical analysis of informal risk-sharing and theoretical modelling on the sustainability and consequences of these arrangements. Risk-sharing can be viewed as the cross-sectional equivalent of consumption smoothing over time. In the absence of enforcement problems, the existence of better savings opportunities and a public safety net providing transfers when common shocks occur, could improve welfare without crowding out the informal insurance arrangement. A transfer-based safety net is, however, likely to crowd out private (precautionary) savings. Informal insurance arrangements are likely to have to be self-enforcing, imposing sustainability constraints. Circumstances in which risk-sharing arrangements may be sustained are, inter alia: a low discount rate of the future, high frequency of interactions, situations in which idiosyncratic shocks are more frequent relative to other shocks. Evaluating the effects of alternative coping mechanisms such as savings, or of policy interventions such as providing better savings instruments or public safety nets, needs to take into account their effect on incentives to sustain the agreement rather than to go it alone. It is possible that opportunities for precautionary savings or a public safety net would actually be welfare reducing and displace the informal insurance arrangement by more than one to one. Any policy intervention that improves an individual’s position outside a private group-based informal risk-sharing arrangement may provide incentives to break down the informal arrangement. Targeted interventions that target only some members of communities or groups could be particularly counterproductive. Group-based savings schemes could provide a useful alternative or complement if one is concerned about crowding-out. The possibly negative welfare effects can be avoided. Whether the crowding-out and potential negative welfare effects of interventions on informal insurance mechanisms are significant is an empirical question. If common shocks are dominant and if groups and communities rather than just individuals are targeted, these negative effects are likely to be less significant. Standard quantitative poverty analysis assumes that consumption is smooth. If smoothing is not possible, especially when large negative shocks occur, then alternative measures of poverty and vulnerability need to be explored. If interiii temporal data are available, broader definitions can be used to describe vulnerability. Aggregate measures of ‘vulnerability’ can be obtained. Targeting assistance to the vulnerable population requires specific kinds of information. Analysing the characteristics of households experiencing chronic or transient poverty, or in general, their consumption fluctuations, can provide this information. Panel data are required for this analysis. If policies are exogenous to the risk management and coping strategies, then information on how households handle income risk is irrelevant. However, policies may affect household opportunities to cope with risk (e.g. by changing exit options from informal insurance). In that case, how households cope with risk is relevant for the design of policies, in turn increasing data requirements. If effective safety nets and other consumption risk-reducing policies require detailed knowledge of existing risk-reducing actions by households, then surveys need information on physical, human and social capital, on shocks, as well as on opportunities in labour, product and asset markets. Panel and cross-section surveys could be used to collect relevant information. The complexity of consumption-risk reducing strategies implies that a simple indicator is unlikely to be available. Measures of vulnerability would typically require detailed data, including from panels. Some indicators that aim to describe vulnerability are typically flawed. The emphasis on the ability to cope with risk via assets, human capital and informal insurance and on the opportunities available, marks a convergence of different disciplines, bridging gaps with more qualitative approaches.