The Response of Income Diversification to Macro and Micro Policy Shocks in Cote D'Ivoire and Kenya

24 Pages Posted: 5 Feb 2001

See all articles by Christopher B. Barrett

Christopher B. Barrett

Cornell University - Charles H. Dyson School of Applied Economics & Management

Mesfin Bezuneh

Clark Atlanta University - Economics

Abdillahi Aboud

Egerton University

Date Written: November 2000

Abstract

This paper presents evidence on the effects of two different sorts of policy shocks on observed income diversification patterns in rural Cote d'Ivoire and Kenya. Data from Cote d'Ivoire show that massive currency devaluation reduced farmer income diversification by inducing a reallocation of effort toward the production of tradable agricultural commodities. But households with poor endowments were less able to respond to attractive emerging on-farm and non-farm opportunities. Due to entry barriers to superior livelihood strategies, the benefits of exchange rate reform accrued disproportionately to households that were richer prior to devaluation. Food-for-work transfers to households in semi-arid Kenya appear to have significantly reduced the liquidity constraints faced by project participants, enabling them to pursue more lucrative livelihood strategies in non-farm activities and higher-return agricultural production patterns. FFW had no discernible effect on income diversification because the agroecology necessitates considerable diversification whether or not one participates in the food-for-work project.

Suggested Citation

Barrett, Christopher B. and Bezuneh, Mesfin and Aboud, Abdillahi, The Response of Income Diversification to Macro and Micro Policy Shocks in Cote D'Ivoire and Kenya (November 2000). Available at SSRN: https://ssrn.com/abstract=257334 or http://dx.doi.org/10.2139/ssrn.257334

Christopher B. Barrett (Contact Author)

Cornell University - Charles H. Dyson School of Applied Economics & Management ( email )

315 Warren Hall
Ithaca, NY 14853-7801
United States
607-255-4489 (Phone)
607-255-9984 (Fax)

HOME PAGE: http://aem.cornell.edu/faculty_sites/cbb2/

Mesfin Bezuneh

Clark Atlanta University - Economics ( email )

223 James P. Brawley Drive, S.W.
Atlanta, GA 30314
United States
404-880-6274 (Phone)
404-880-6276 (Fax)

Abdillahi Aboud

Egerton University ( email )

Biashara Kilimo Road
Njoro
Kenya

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
117
Abstract Views
1,460
Rank
427,613
PlumX Metrics