Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2007-01-26
Revision-Date: 2007-09-28
Number: 07-014/2
Author-Name: Lei Pan
Author-Email: lpan@feweb.vu.nl
Author-Workplace-Name: Vrije Universiteit Amsterdam
Title: Risk Pooling through Transfers in Rural Ethiopia
Abstract: It is often assumed that transfers received from governments, nongovernment organizations (NGOs), friends and relatives help rural households to pool risk. In this paper I investigate two functions of transfers in Ethiopia: risk pooling and income redistribution. Unlike most of the literature this paper investigates not only whether but also how much risk pooling is achieved. I find evidence that transfers from governments/NGOs play a role in insuring covariant income shocks, (weak) evidence that transfers from friends/relatives insure idiosyncratic income shocks and evidence that transfers target the poor households. However, the contributions of transfers to risk pooling and income redistribution are economically very limited.
Classification-JEL: I38; O17
Keywords: Risk; Insurance; Income redistribution
File-Url: https://papers.tinbergen.nl/07014.pdf
File-Format: application/pdf
File-Size: 473469 bytes
Handle: RePEc:tin:wpaper:20070014