Credit Market Constraints, Consumption Smoothing, and the Accumulation of Durable Production Assets in Low-Income Countries: Investments in Bullocks in India

Rosenzweig, Mark R.; Wolpin, Kenneth I.

doi:10.1086/261874

Cited by 928 publications

(569 citation statements)

References 18 publications

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“…These estimates suggest that households adjust economic activities as a channel to insure against health shock. The fact that livestock investment is reduced the most indicates that households are shifting away from risky production (i.e., raising livestock) to conservative production in order to protect themselves from adverse income shocks (Rosenzweig and Wolpin, 1993). The estimated coefficients α 1 (on the interaction term between health shock and reform) are positive but insignificantly different from zero.…”

Section: Investment In Agricultural Activitiesmentioning

confidence: 94%

Insuring against health shocks: Health insurance and household choices

Liu

2016

Journal of Health Economics

105

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. This paper provides empirical evidence on the role of public health insurance in mitigating adverse outcomes associated with health shocks. Exploiting the rollout of a universal health insurance program in rural China, I find that total household income and consumption are fully insured against health shocks even without access to health insurance. Household labor supply is an important insurance mechanism against health shocks. Access to health insurance helps households to maintain investment in children's human capital during negative health shocks, which suggests that one benefit of health insurance could arise from reducing the use of costly smoothing mechanisms. JEL Classification:D1, O1, I1

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Section: Investment In Agricultural Activitiesmentioning

confidence: 94%

Insuring against health shocks: Health insurance and household choices

Liu

2016

Journal of Health Economics

105

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“…Morduch (1995) documents how more profitable technologies are not adopted because they are too risky in a particular setting in India. The same farmers have been found to hold livestock as a precaution against risk even when more productive investment opportunities exist (Rosenzweig and Wolpin, 1993). Rosenzweig and Binswanger (1993) found that the loss in efficiency between the richest and poorest quintiles in their sample from India was more than 25 percent, attributable to portfolio adjustments in assets and activities due to risk exposure.…”

Section: Insurance Market Failures and Risk Induced Poverty Trapsmentioning

confidence: 99%

Rural Poverty: Old Challenges in New Contexts

Dercon

2009

The World Bank Research Observer

155

103

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“…Indeed, the development literature offers an abundance of microeconomic evidence linking income volatility to lower investment in both physical and human capital. Households imperfectly protected from risk change their incomegenerating activities in the face of income volatility, diversifying towards low-risk alternatives with lower average returns (Dercon 2004;Fafchamps 2004), as well as to lower levels of investment (Rosenweig and Wolpin 1993). Furthermore, severe cuts in health and education follow negative shocks to household income in poor countries -cuts that disproportionately affect children and hence long term human capital accumulation (Jensen 2000;Jacoby and Skoufias 1997;Frankenburg et al 1999;Thomas et al 2004).…”

Section: Agenda: Assessing the Impact Of Terms Of Trade Volatility Onmentioning

confidence: 99%

Globalization, de-industrialization and underdevelopment in the third world before the modern era

Williamson

2006

RHE / JILAEH

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Between 1810 and 1940, a large GDP per capita gap appeared between the industrial core and the poor periphery, the latter producing, increasingly, primary products. Over the same period, the terms of trade facing the periphery underwent a secular boom then bust, peaking in the 1870s or 1890s. These terms of trade trends appear to have been exogenous to the periphery. Additionally, the terms of trade facing the periphery exhibited relatively high volatility. Are these correla-9

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Credit Market Constraints, Consumption Smoothing, and the Accumulation of Durable Production Assets in Low-Income Countries: Investments in Bullocks in India

Cited by 928 publications

References 18 publications

Insuring against health shocks: Health insurance and household choices

Insuring against health shocks: Health insurance and household choices

Rural Poverty: Old Challenges in New Contexts

Globalization, de-industrialization and underdevelopment in the third world before the modern era

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