Household Responses to Shocks in Rural Ethiopia

• Tác giả: Daniel Ayalew Ali
• Ngôn ngữ: eng
• Ký hiệu phân loại: 963 *Ethiopia and Eritrea
• Thông tin xuất bản: World Bank, Washington, DC, 2015
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 293875
• Chủ đề: 1. CREDIT MARKETS; 2. LIVE ANIMALS; 3. MANURE; 4. POULTRY; 5. TRANSITORY INCOME

Tóm tắt

This paper uses a stochastic dynamic programming model to characterize the optimal savings-consumption decisions and the role of livestock inventories as a buffer stock in rural Ethiopia. The results show that relatively land-rich households use accumulation and liquidation of cattle and other animal inventories for partial consumption smoothing, while low-income households appear not to do so. The results highlight the need for improvement in livestock markets, which are often affected by high transaction costs and price risk, and for investigation of other approaches to risk management.