Health shocks and consumption smoothing in rural households: Does microcredit have a role to play?

Islam, Asad; Maitra, Pushkar

doi:10.1016/j.jdeveco.2011.05.003

Cited by 237 publications

(188 citation statements)

References 30 publications

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“…In a quasi-experimental setting of bus accidents in India, Mohanan (2011), for example, finds that debt was the principal mechanism used by households to mitigate the shock's effects while consumption was smoothed quite well. Although taking up debt may be chosen by households to avoid other, eventually more harmful strategies to cope with such events, like the sale of assets, work more, take children out of school, or cut investment spending (Beegle, Dehejia, & Gatti, 2006;Gertler, Levine, & Moretti, 2009;Guarcello, Mealli, & Rosati, 2009; specifically on health shocks : Islam & Maitra, 2011;Jacoby & Skoufias, 1997), the financing of health care expenditures through debt can also create large and lasting financial burdens for households (Damme, Leemput, Por, Hardeman, & Meessen, 2004). This paper's hypothesis is that remittances -the money sent home by migrantsfunction as a substitute for credit when households face liquidity shortages.…”

Section: Introduction and Related Literaturementioning

confidence: 99%

Are Remittances a Substitute for Credit? Carrying the Financial Burden of Health Shocks in National and Transnational Households

Ambrosius¹,

Cuecuecha²

2013

World Development

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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. The assumption that remittances are a substitute for credit has been an implicit or explicit theoretical foundation of many empirical studies on remittances. This paper directly tests this assumption by comparing the response to health-related shocks among national and transnational households using panel data from Mexico for 2002 and. While the occurrence of serious health shocks that required hospital treatment doubled the average debt burden of exposed households compared to the control group, households with nuclear family members (a parent, child, or spouse) in the US did not increase their debts due to health shocks. This finding is consistent with the view that remittances respond to households' demand for financing emergencies and make them less reliant on debt-financing. Terms of use: Documents in

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Section: Introduction and Related Literaturementioning

confidence: 99%

Are Remittances a Substitute for Credit? Carrying the Financial Burden of Health Shocks in National and Transnational Households

Ambrosius¹,

Cuecuecha²

2013

World Development

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“…In Indonesia, an analysis of the Indonesian Family Life Survey data found that the presence of microfinance-based SHGs was associated with a positive change in children’s health [7]. In Bangladesh, an analysis of a household-level panel data set collected over 8 years found that access to microcredit enabled households to insure against health shocks [8]. …”

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confidence: 99%

Expanding health coverage in India: role of microfinance-based self-help groups

Saha

2017

Global Health Action

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To fulfil its commitment to universal health coverage, it will be necessary for the Indian government to expand access to appropriate and affordable health services. Through the mechanism of microfinance-based self-help groups (SHGs), poor women and their families are provided not only with access to finance to improve their livelihoods but also, in many cases, with a range of basic health services. Governments and non-governmental organisations in India have implemented large-scale programmes for the promotion of SHGs. With 93 million people organised nationally, the SHGs provide an established population base that can potentially be used to extend health coverage. However, the potential for working with SHGs to improve people’s access to health services has not been an active part of the national policy discourse.

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“…Group-based approaches are an important coping tool in the absence of consumption loans, costly formal insurance and credit constraints, through facilitating informal insurance and micro-credit that are essential for short-term consumption smoothing and asset protection strategies (see Fafchamps & Lund 2003;Islam & Maitra 2012;Demont 2013). Furthermore, social capital is a valuable post-shock recovery vehicle that empowers households to rebuild livestock assets (see Mawejje & Holden 2014 for Uganda) and building resilience of rural communities against extreme events (Bernier & Meinzen-Dick 2014).…”

Section: Discussionmentioning

confidence: 99%

The Role of Livestock Portfolios and Group-Based Approaches for Building Resilience in the Face of Accelerating Climate Change: An Asset-Based Panel Data Analysis from Rural Kenya

2015

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Suggested Citation: Ngigi, Marther W.; Mueller, Ulrike; Birner, Regina (2015) : The role of livestock portfolios and group-based approaches for building resilience in the face of accelerating climate change: An asset-based panel data analysis from rural Kenya AbstractThis study examines the impact of multiple shocks on assets by employing two waves of a panel data set of 360 rural households in three agro-ecological zones in Kenya. To control for unobserved heterogeneity, a 'within' household fixed effects model was employed. One major finding is that climatic shocks negatively affect households' livestock holdings -apart from small ruminant and non-ruminant livestock due to their higher adaptive capacity. Consequently, households rely on two major coping strategies to smooth their consumption level: (1) adjusting their livestock portfolios, and (2) borrowing from group-based approaches. The latter strategy is particularly important for poor households in safeguarding their already low asset base. The findings suggest that livestock protection policies, such as diversification of livestock portfolios, promotion of fodder banks and index-based livestock insurance, are substantial. Scaling-up of group-based approaches would augment poor households' recovery and resilience against multiple shocks in the face of accelerating climate change.

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Health shocks and consumption smoothing in rural households: Does microcredit have a role to play?

Cited by 237 publications

References 30 publications

Are Remittances a Substitute for Credit? Carrying the Financial Burden of Health Shocks in National and Transnational Households

Are Remittances a Substitute for Credit? Carrying the Financial Burden of Health Shocks in National and Transnational Households

Expanding health coverage in India: role of microfinance-based self-help groups

The Role of Livestock Portfolios and Group-Based Approaches for Building Resilience in the Face of Accelerating Climate Change: An Asset-Based Panel Data Analysis from Rural Kenya

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