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Social capital as a coping mechanism for seasonal deprivation: The case of the Monga in Bangladesh

Rejaul Bakshi, Debdulal Mallick () and Mehmet Ulubasoglu

MPRA Paper from University Library of Munich, Germany

Abstract: The extreme hunger and deprivation that recurs every year in the lean season in northern Bangladesh, locally known as the Monga, is mainly due to the malfunctioning local labor and credit markets. Using data covering 5,600 extreme poor households in the Monga-prone region, we investigate in detail the role of social capital in securing employment and obtaining informal loans. Correcting for the endogeneity of social capital by the heteroscedasticity-based method proposed by Klein and Vella (2010) and also by the standard IV method for a robustness check, we document that social capital plays an important role in obtaining both wage- and self-employment. We also document a weak negative effect of social capital on obtaining informal loans. We explain our results in terms of the role of horizontal and vertical components of our measures of social capital in influencing different outcomes.

Keywords: Monga; extreme seasonality; social capital; heteroscedasticity; employment; informal loan (search for similar items in EconPapers)
JEL-codes: G21 I32 P46 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev, nep-iue, nep-mfd and nep-soc
Date: 2017, Revised 2018
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Journal Article: Social capital as a coping mechanism for seasonal deprivation: the case of the Monga in Bangladesh (2019) Downloads
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