Room 332 Monroe Hall
Department of Economics
University of Virginia
Charlottesville, VA 22902
Phone (Mobile): +44 (0)75 4587 1723
|I am an Assistant Professor of Economics at the University of Virginia. My research focusses on Environmental and Development Economics.|
- Environmental and Energy Economics,
- Growth and Development,
- Public Economics,
- Labor Economics,
- International Trade.
- Winner of the FEEM Award 2013 (Young Economist Prize awarded by the European Economic Association).
Abstract: To what degree can the movement of workers across sectors mitigate the economic consequences of weather-driven agricultural productivity shocks? Combining worker-level, firm-level and district-level data with high-resolution meteorological data, I examine the effects of weather on economic activity in India. I estimate that increases in temperature are associated with a reduction in agricultural production, but that prices do not respond, consistent with a "law of one price". Consequently, I find that workers are able to manage reductions in agricultural labour demand by moving into the manufacturing sector, highlighting the importance of market integration and diversification. Having established this, I examine the effects of labour reallocation on economic outcomes in the formal manufacturing sector. I find that workers move into casual manufacturing activities, with a corresponding decrease in the average wage of casual workers, suggesting that workers face little impediment in the movement across sectors within casual tasks. More surprisingly, this reallocation also results in (a) an increase in manufacturing productivity, (b) the average wage of permanent manufacturing workers, and (c) an increase in the number of items that the firm produces -- a restructuring of production. Counterfactual estimates suggest that the reallocation of labour across sectors could significantly offset the economic losses of weather-driven agricultural productivity shocks.
Abstract: Separating the effects of uncertainty from realised events and identifying the welfare effects of uncertainty both present a number of empirical challenges. Combining individual-level panel data from rural Ethiopia with high-resolution meteorological data, we estimate that an increase in income uncertainty – proxied by rainfall variability, after controlling for both contemporaneous and historical weather events – is associated with a reduction in objective consumption and subjective well-being. We find that 85% of the effect on subjective well-being are due to the direct effects of uncertainty, with the remainder arising through changes in consumption. Finally, we observe that the effects of rainfall variability on subjective well-being are mitigated for households that have access to Eqqubs – a balanced reciprocity risk sharing mechanism, in which members pool funds and rotate payments – suggesting, that households are paying into this insurance device to mitigate future shocks, rather than receiving payouts in response to realised shocks. Our results suggest that the welfare gains from further consumption smoothing, are likely to be substantially greater than estimates based solely on observed fluctuations.
Abstract: How does parental income uncertainty affect child labor and human capital investments in
village economies? Theoretically, the relationship is ambiguous: on the one hand, a precautionary response could reduce investments in human capital; on the other hand, a portfolio motive
could increase investments in human capital, as households attempt to diversify income. Using child-level panel data from rural Ethiopia, I set out to explore the effects of parental income
uncertainty on child labor and educational outcomes. I find that an increase in parental income uncertainty -- proxied by rainfall variability, which has no direct effect on agricultural
productivity, after controlling for historical weather events --, is associated with: a reduction in the number of hours children spend working on the farm and an increase in time spent in school,
suggesting that parents invest in human capital as a response to uncertainty about future states of the world. However, consistent with the precautionary motive, I find that an increase in
parental income uncertainty during the early stages of childhood is associated with a reduction in the likelihood that children attend school. The negative relationship between uncertainty
and schooling weakens and reverses as the child grows older and the returns to education, and consequently diversification, increase.