Research Proposal: Can anti-poverty policies reduce vulnerability to weather shocks?
EfD-CA Researchers: Juan Robalino and Catalina Sandoval
Collaborators: Laura Villalobos (PhD. Student in Gothemburg University), Pablo Imbach and Cristian Brenes (Climate Change Program at CATIE)
Abstract: Central America and Mexico have often been affected by extreme weather events. These shocks have generated high levels of poverty that persisted over time. To reduce poverty levels, governments have implemented policies such as conditional cash transfers, which have shown to be highly effective. However, it is unclear if they can reduce household vulnerability to unexpected natural shocks. Some have argued that these policies could serve as safety nets (de Janvry et al. 2006). But others have shown that conditional cash transfers could exacerbate the effects of specific negative shocks, for instance, in child labor (Gitter et al. 2011). The main goal of this project is to estimate the effects of extreme weather events on child labor, school attendance, and household consumption and to test if conditional cash transfers can reduce their negative effects. We will use panel data for Mexico and Nicaragua and pool cross-section in Costa Rica to test our hypothesis. One important advantage of this analysis is that the conditional cash transfers were randomly assigned in the cases of Mexico and Nicaragua. This will help us to eliminate and reduce significantly potential estimation bias. However, one of our key contributions will be the use of highly detail spatial and temporal weather data. This will help us to assure exogenous variations and reduce bias of the estimated effect of natural shocks and the capacity of conditional cash transfers to reduce vulnerability. The results of this analysis can be used by policy makers to take more informed decisions about climate change adaptation capacity and anti-poverty policies. We will make use of effective tools to communicate our results to policy makers.
The main goal of this project is to estimate the effects of extreme weather events on child labor, school attendance, and household consumption and to test if conditional cash transfers can reduce their negative effects.