Labor Responses to Rainfall Variability in Rural Ethiopia: A Model of Migration, Off-farm Activities and Remittance

Jianfeng Gao and Bradford Mills

No 205500, 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California from Agricultural and Applied Economics Association

Abstract: This study aims to investigate the impacts of rainfall variability on migration, off-farm activities and transfers in rural Ethiopia. We develop a theoretical model in which migration, (on-farm, off-farm and urban) labor supplies and transfers are jointly decided from household utility maximization. Several hypotheses are developed from the model about the impact of rainfall variability on these decisions. These hypotheses are tested against a panel dataset we compile by matching household data with village-level historical rainfall data. We find that the share of out-migrated household members decreases with mean rainfall level and increases with the standard deviation of rainfall in main (Kiremt) growing seasons of the five years prior to the survey. Per capital off-farm labor supply and participation in public transfer programs decreases with mean rainfall level in the Kiremt season of the year prior to the survey, and increases with the standard deviation of rainfall in the Kiremt seasons of the five years prior to the survey. The level and standard deviation of rainfall may have no effect on the amount of transfers that households receive from former household members and the informal social safety nets (ISSN).

Keywords: Farm Management; Labor and Human Capital (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea15:205500

DOI: 10.22004/ag.econ.205500

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