After The Flood

Abstract

This doctoral dissertation studies farm exit and returns to housing for rural communities living under high incidence of poverty. The analytical framework leverages on a natural experiment that triggered an extensive government intervention, where widespread reconstruction and shelter provision plausibly caused structural transformation of agriculture and advanced living conditions. Chapter 1 outlines the overall research design pursued in order to evaluate the effects of the program, starting with a backdrop that ascribes the intervention. Next, it introduces the survey employed in order to gather data on the study area. This is followed by the configuration of the sampling frame, detailing power calculations and the algorithm that randomly selects observations. Finally, it depicts the identification strategy that enables causal interpretation of differential treatment conditions which are examined in detail in Chapters 2 and 3. Chapter 2 analyzes households’ decision to exit agriculture, arguing that an aggregate demand shock, associated with the intervention, increased the value of outside options among farmers. Relatively low farm earnings, relaxed credit constraints, and changes in risk attitudes after the disaster, prompted factor reallocations that underlay baseline suboptimal outcomes. Findings reflect structural transformation, with baseline farmers engaging in nonfarm activities —through work or enterprises— at a significantly higher rate relative to their counterparts in a village where no intervention took place. Chapter 3 —joint work with Rachel Heath— documents health and labor market responses to dwelling provision among households that, albeit inhabiting identical infrastructures after the intervention, exhibit heterogenous baseline access to adequate housing. Results indicate that shelter enhancements reduced the incidence of health shocks and quarterly doctor visits. It also improved self-reported satisfaction across standard wellbeing measures (life, health, and housing), underpinning psychological benefits associated with receiving a new house. These effects are particularly robust among families that initially experienced qualitative housing shortages.