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Does climate change perception make livelihood diversification more effective? Evidence from the consumption mobility study of rural households

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Listed:
  • Saudamini Das
  • Arup Mitra

    (Institute of Economic Growth, Delhi)

Abstract

Poor households engage in multiple activities to maintain their consumption in face of economic hardships or exogenous shocks. In this paper, we try to examine the effectiveness of such livelihood diversification to increase or maintain the inter-temporal consumption level conditional to the climate change knowledge of the households. We use a cross sectional survey data of 1200 households from central and western parts of Odisha and estimate multiple regression models with and without the assumption of endogeneity of occupational diversification index. Results clearly establish that households perceiving climate change significantly are able to benefit from diversification and maintain or improve their consumption intake over time, whereas those with no significant climate knowledge, are not able to benefit from diversification. In India, offering avenues for diversification has been a prime government policy with a view to augmenting farmers’ income; however, such policies will have limited effects unless farmers are given the correct climate education to be able to choose the right activities which can increase their income and stabilise consumption.

Suggested Citation

  • Saudamini Das & Arup Mitra, 2021. "Does climate change perception make livelihood diversification more effective? Evidence from the consumption mobility study of rural households," IEG Working Papers 425, Institute of Economic Growth.
    • Handle: RePEc:awe:wpaper:425
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    References listed on IDEAS

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    1. Anjini Kochar, 1999. "Smoothing Consumption by Smoothing Income: Hours-of-Work Responses to Idiosyncratic Agricultural Shocks in Rural India," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 50-61, February.
    2. Saudamini Das, 2012. "The role of natural ecosystems and socio-economic factors in the vulnerability of coastal villages to cyclone and storm surge," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 64(1), pages 531-546, October.
    3. Jonathan Morduch, 1995. "Income Smoothing and Consumption Smoothing," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 103-114, Summer.
    4. Saudamini Das & Stephen C. Smith, 2012. "Awareness As An Adaptation Strategy For Reducing Mortality From Heat Waves: Evidence From A Disaster Risk Management Program In India," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 3(02), pages 1-29.
    5. S. Nazrul Islam & John Winkel, 2017. "Climate Change and Social Inequality," Working Papers 152, United Nations, Department of Economics and Social Affairs.
    6. repec:gwi:wpaper:2012-06 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Climate change; livelihood diversification; consumption mobility; Odisha; farmer’s income;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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