Variability in agricultural productivity and rural household consumption inequality: Evidence from Nigeria and Uganda

Mulubrhan Amare, Bekele Shiferaw, Hiroyuki Takeshima and George Mavrotas

No 67, NSSP working papers from International Food Policy Research Institute (IFPRI)

Abstract: This paper uses multiple rounds of household survey panel data to assess the distributional implications of variability in agricultural productivity in Nigeria and Uganda. It uses both a conventional decomposition and a regression-based inequality decomposition to estimate the impact of climate-induced variability in agricultural productivity. To mitigate the endogeneity associated with unobserved time-invariant and time-variant household fixed effects, we use rainfall shocks as a proxy for estimating the exogenous variability in agricultural productivity that affects consumption. Results suggest that a 10 percent increase in the variability of agricultural productivity tends to decrease household consumption by 38 and 52 percent on average for Nigeria and Uganda, respectively. Controlling for other factors, variability in agricultural productivity contributed to between 25 and 43 percent of consumption inequality between 2010 and 2015 for Nigeria; and 16 and 31 percent of consumption inequality between 2009 and 2011 for Uganda. We also show that variability in agricultural productivity increases changes in consumption inequality over time.

Keywords: shock; consumption; climate; agricultural productivity; household consumption; rural areas; equality; Nigeria; Uganda; Western Africa; Sub-Saharan Africa; Africa; Eastern Africa (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-agr, nep-dev, nep-eff and nep-env
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Citations: View citations in EconPapers (4)

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https://hdl.handle.net/10568/143913

Related works:
Journal Article: Variability in agricultural productivity and rural household consumption inequality: Evidence from Nigeria and Uganda (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:fpr:nsspwp:67

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