Do Natural Disasters Really Lead to More Migration? Evidence from Indonesia (Job Market Paper)
Using Indonesian panel datasets, I examine how earthquakes, volcanic eruptions and floods affect household migration. The study separately analyzes the impact of these natural disasters on the tendency of entire households to migrate, as well as for part of the household to split off and migrate. Contrary to conventional wisdom, I find that all three types of disasters significantly reduce migration rates. Nevertheless, the channels of impact are quite different. Earthquakes reduce household size, earnings and non-business assets, each of which tends to reduce migration rates. Volcanic eruptions on the other hand raise the value of farmland, which, in turn, reduces migration. Floods have no significant impacts on household assets or earnings, and their effect remains unexplained.
Risk Aversion, Time Preferences and Rainfall: Evidence from Ethiopia’s Droughts
Using the last round of Ethiopian Rural Household Survey (ERHS) conducted in 2009, I estimate how rain failures change household level of impatience and behaviors of risk aversion. The results show that inappropriate timing and duration of rainfall make households more impatient. Also, when rain failures get more frequent, households become more risk averse. The paper goes on to study how risk aversion and time preferences affect different household decisions and discovers that more risk averse households spend less on fertilizers and take less loan for off-farm businesses. Meanwhile, households which show higher level of impatience spend less on child education.
Social Capital in Indonesia
This paper studies the impacts of accumulating social capital on household socio-economic welfare in Indonesia. In particular, I look at the effectiveness of social capital in reducing the adverse effects of economic shocks of various kinds. The findings show that households taking part more in Arisan (the Rotating Savings and Credit Association in Indonesia) and other general social organizations fare better in total earnings, level of food consumption, child education and health status. Accumulating more social capital is also effective in lessening the adverse impacts of economic shocks, which enables household to maintain total earnings and level of food consumption. Finally, the paper goes on to check whether social capital and government support are complementary goods or substitutes and discovers that households provided with more government support take part less in general social organizations but their participation in Arisan is not much affected.