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Risk and Schooling Decisions in Rural Madagascar: A Panel Data-Analysis

Author

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  • Flore Gubert
  • Anne-Sophie Robilliard

Abstract

Most households in rural Madagascar are engaged in agriculture and derive a large share of their income from the production of food or cash crops and from animal husbandry. However, agricultural yields can be extremely volatile due to weather conditions, pests, insects, rodents and other calamities. As a result, households record large fluctuations in their incomes that must be dealt with. Since the usual consumption-smoothing market mechanisms are quite limited in the Malagasy context, households need to rely on non-market mechanisms or to adopt multi-faceted strategies to cope with risk. In this paper, we examine the possibility that parents obtain informal income insurance by letting their children work. We test this hypothesis by examining the relationship between household income shocks and human capital investment in children. In particular, we investigate whether children's propensity to join school and to drop out of school responds to transient shocks. We also investigate issues such as gender and intrahousehold resource allocation. Copyright 2008 The author 2007. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

Suggested Citation

  • Flore Gubert & Anne-Sophie Robilliard, 2008. "Risk and Schooling Decisions in Rural Madagascar: A Panel Data-Analysis," Journal of African Economies, Centre for the Study of African Economies, vol. 17(2), pages 207-238, March.
    • Handle: RePEc:oup:jafrec:v:17:y:2008:i:2:p:207-238
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    File URL: http://hdl.handle.net/10.1093/jae/ejm010
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    Cited by:

    1. Esther Gehrke & Friederike Lenel & Claudia Schupp, 2023. "COVID-19 Crisis, Economic Hardships, and Schooling Outcomes," Education Finance and Policy, MIT Press, vol. 18(3), pages 522-546, Summer.
    2. Augendra BHUKUTH & Jérôme BALLET & Bako Nirina RABEVOHITRA & Patrick RASOLOFO, 2014. "Analysing the Effects of Crop Shocks on Child Work: the Case of the Morondava District in Madagascar," Cahiers du GREThA (2007-2019) 2014-17, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    3. Thomas, Anne-Claire & Gaspart, Frédéric, 2015. "Does Poverty Trap Rural Malagasy Households?," World Development, Elsevier, vol. 67(C), pages 490-505.
    4. Sen, Kritika & Villa, Kira M., 2022. "Rainfall shocks and adolescent school-work transition: Evidence from rural South Africa," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322383, Agricultural and Applied Economics Association.
    5. Fitzsimons, Emla & Mesnard, Alice, 2013. "Can conditional cash transfers compensate for a father's absence ?," Policy Research Working Paper Series 6476, The World Bank.
    6. VERHEYDEN Bertrand & FAYE Ousmane, 2011. "Fertility and Child Occupation: Theory and Evidence from Senegal," LISER Working Paper Series 2011-59, Luxembourg Institute of Socio-Economic Research (LISER).
    7. Mesnard, Alice & Fitzsimons, Emla, 2012. "How children?s schooling and work is affected when their father leaves permanently: Evidence from Colombia," CEPR Discussion Papers 8886, C.E.P.R. Discussion Papers.
    8. repec:dau:papers:123456789/10594 is not listed on IDEAS
    9. Emla Fitzsimons & Alice Mesnard, 2012. "How children's schooling and work are affected when their father leaves permanently: evidence from Colombia," IFS Working Papers W12/04, Institute for Fiscal Studies.
    10. DELPIERRE Matthieu & VERHEYDEN Bertrand & WEYNANTS Stéphanie, 2011. "On the interaction between risk-taking and risk-sharing under farm household wealth heterogeneity," LISER Working Paper Series 2011-35, Luxembourg Institute of Socio-Economic Research (LISER).
    11. Trong‐Anh Trinh & Alberto Posso & Simon Feeny, 2020. "Child Labor and Rainfall Deviation: Panel Data Evidence from Rural Vietnam," The Developing Economies, Institute of Developing Economies, vol. 58(1), pages 63-76, March.
    12. Delpierre, Matthieu & Verheyden, Bertrand & Weynants, Stéphanie, 2016. "Is informal risk-sharing less effective for the poor? Risk externalities and moral hazard in mutual insurance," Journal of Development Economics, Elsevier, vol. 118(C), pages 282-297.
    13. Andrew D. Foster & Esther Gehrke, 2017. "Start What You Finish! Ex Ante Risk and Schooling Investments in the Presence of Dynamic Complementarities," NBER Working Papers 24041, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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