Do crop income shocks widen disparities in smallholder agricultural investments? Panel survey evidence from Zambia

Type Conference Paper - 2015 AAEA & WAEA Joint Annual Meeting
Title Do crop income shocks widen disparities in smallholder agricultural investments? Panel survey evidence from Zambia
Author(s)
Publication (Day/Month/Year) 2015
City San Francisco
Country/State California
URL http://ageconsearch.tind.io/record/205555/files/maize_inputs_2.pdf
Abstract
In the wake of an income shock, a household will reallocate and transact its many types of
assets—including livestock, land, labor, and cash—with the dual objectives of maintaining a
minimum level of current consumption and protecting its prospects for future consumption.
Clearly, the inability of a household to maintain a subsistence level of consumption represents an
immediate catastrophe. On the other hand, permitting shocks to compromise prospects for future
consumption threatens a household in a different way: if such shocks occur with regularity, each
event can slowly drag the household deeper into poverty. Poorer households, it appears, are not
able to perfectly smooth present consumption; nor are they able to fully protect future
consumption. For these households, the effects of 'bad' seasons may be transmitted into the
future via depleted assets and the diversion of resources from the most remunerative activities.

Related studies

»