13 research outputs found
The gendered impacts of index-insurance on food-consumption: Evidence from southern Ethiopia
No full textIndex insurance has been promoted as an innovative strategy for enhancing long-term resilience to climate-related shocks and providing financial inclusion, particularly to poor women farmers in developing countries. In this paper, we evaluate the gendered impact of an index-based livestock insurance product on food consumption among pastoral households in southern Ethiopia. We exploit intertemporal variation in household risk exposure and insurance payouts to evaluate the ex ante and ex post insurance impacts and use randomly distributed discount coupons to instrument the insurance purchase variables. We find that during the pre-drought period, a previous season insurance purchase and the intensity of insurance coverage significantly and equally reduces food expenditure in male- and female-headed households. In the post-drought period, we find that an insurance payout significantly increases food expenditure per adult equivalent among female-headed households.PRIFPRI3; ISI; IFPRIOAForesight and Policy Modeling (FPM); Transformation Strategie
Estimating the intrahousehold costs and benefits of innovations to enhance smallholder farmers’ resilience
No full textThis paper introduces a new framework to quantify costs and benefits for resilience-related outcomes of agricultural innovations targeting smallholder farmers. The framework employs a non-unitary household model with expected utility to quantify welfare benefits associated with non-monetary outcomes that are important from a development perspective, such as improved consumption smoothing, empowerment, and changes in time use. We demonstrate the application of the framework using a case study of climate information services (CIS) in Ghana. We develop a set of individual bargaining weights based on the women’s empowerment in agriculture index, to demonstrate how benefits from CIS are distributed among men and women within households. We find that for the average risk-averse farmer, using CIS is associated with a 37-percent increase in expected utility, but male household heads benefit more than women living in male-headed households. Cost–benefit analyses that do not consider the intrahousehold distribution of benefits associated with agricultural innovations will overestimate benefits accruing to women with low bargaining power.PRIFPRI3; ISI; DCA; 1 Fostering Climate-Resilient and Sustainable Food Supply; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food Industry; G Cross-cutting gender themeForesight and Policy Modeling (FPM);Markets, Trade, and Institutions (MTI); Food and Nutrition Policy; Transformation Strategie
Gender-inclusive, -responsive, and -transformative agricultural insurance: A literature review
No full textPR3 Building Inclusive and Efficient Markets, Trade Systems, and Food Industry; ISI; G Cross-cutting gender theme; IFPRI3; CRP2; CRP7Foresight and Policy Modeling (FPM); Transformation Strategies; Markets, Trade, and Institutions (MTI); Food and Nutrition Policy; PIMCGIAR Research Program on Policies, Institutions, and Markets (PIM); CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS
Costs of climate information services development and implementation
No full textAccelerating Impacts of CGIAR Climate Research for Africa (AICCRA) works to facilitate and scale the development of tailored CIS and climate-smart agriculture making it accessible to smallholder farmers in six target countries. However, the costs and benefits of providing CIS to smallholder farmers have not yet been well-documented. AICCRA is developing a methodology and toolkit to help stakeholders assess the public and private costs and benefits of CIS to provide economic justification for these interventions. This in turn is expected to improve investments in adaptation and ensure that limited resources are being spent effectively.Non-PRIFPRI5MTI
Feasibility of implementing a Risk-Contingent Credit (RCC) program in Zambia: Stakeholder engagement
No full textChanges in frequency and intensity of climate and weather events are a key challenge to agricultural production among farmers in Zambia. Climate variability reduces farm productivity, which in turn contributes to household food insecurity, income variability, and reduced overall economic growth. Using improved technologies such as mechanization, improved seed varieties, irrigation, and fertilizer can improve climate resilience and farm production among smallholder farmers. However, in Zambia, as in many countries in sub-Saharan Africa, most famers lack sufficient access to credit to purchase these technologies. Limited access to credit is mainly attributed to lack of collateral, fear of losing collateral in case of a default, and low financial literacy among smallholder famers (Balana et al. 2022). Information asymmetry also makes it risky and expensive for lenders to serve smallholder farmers, thus they ration the quantity of credit offered and/or raise the interest rates making credit too expensive and inaccessible for millions of smallholder farmers. Bundling agricultural credit with insurance, commonly referred to as risk-contingent credit (RCC), provides a mechanism for addressing some of the credit access constraints faced by smallholder farmers in developing countries. RCC is a loan product that is bundled with an insurance component. RCC seeks to enhance long-term resilience to climate uncertainties by promoting optimal farm investment and productivity among smallholders through sustainable access to credit markets. Under RCC, qualifying smallholder farmers borrow funds for agricultural production from formal financial institutions such as banks and microfinance institutions with minimum collateral requirements. The borrower’s ability to repay the loan is linked to climate outcomes, which are highly correlated with farm productivity. An insurance company underwrites the climate risks (either in the form of drought or flood), such that if that underlying risk passes a certain threshold, the insurance is triggered and part or all of the borrower’s liability is transferred to the insurer. If the underlying risk remains below the threshold, the borrower repays the loan at the agreed upon interest rates and is also obligated to pay the insurance premium, as part of the loan repayment. Linking farmers’ loan repayment obligations to an underlying risk, as opposed to stringent collateral requirements, is expected to reduce the borrowing constraints faced by many poor farmers. At the same time, de-risking the lender by transferring a portion of risks to the insurance market is expected to promote credit supply, hence expanding the rural credit market (Shee et al. 2019).Non-PRIFPRI1; Capacity Strengthening; 4 Transforming Agricultural and Rural Economies; 5 Strengthening Institutions and GovernanceForesight and Policy Modeling (FPM); Transformation Strategie
Risk contingent credit: A stakeholder engagement to inform project expansion in Kenya
No full textA large proportion of farm households in developing countries face a host of market and production risks that undermine their food security, make their income volatile, and make them hesitant to adopt new technologies or undertake new investments that might increase their long-term productivity and household welfare. Climate-related risks such as floods and droughts remain some of the most pervasive forms of production challenges. Adapting to climate variability and change is essential in safeguarding food security, ensuring economic growth, and advancing climate resilience among smallholder farmers. Recent research has shown that transferring some of the climate-related risks to the insurance market in exchange for a payout can shield the welfare of smallholders from the adverse effects of extreme weather conditions, while agricultural financing can help farmers to acquire and adopt agricultural inputs such as improved seed varieties, fertilizer, pesticides, and herbicides. However, in many developing countries, formal financial markets remain inaccessible to smallholder farmers.Non-PRIFPRI5; 5 Strengthening Institutions and Governance; 4 Transforming Agricultural and Rural EconomiesForesight and Policy Modeling (FPM); Transformation Strategie
Risk-Contingent Credit (RCC): Assessing smallholders' agricultural credit needs and the feasibility of implementing RCC in Ethiopia
No full textAgricultural credit is an important instrument for improving farm productivity, the welfare of farm households, and their resilience to weather-related shocks. However, small-scale farmers’ access to credit is limited by demand- and supply-side constraints. Risk-contingent credit, which bundles credit with insurance against climate risks, is one promising solution. This study, conducted in three woredas in Ethiopia, implemented a game designed to increased farmers’ understanding of the product and finds that farmers recognize the potential of RCC.PRIFPRI1; DCA; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food Industry; 4 Transforming Agricultural and Rural Economies; Capacity Strengthening; CRP2Foresight and Policy Modeling (FPM); Transformation Strategies; PIMCGIAR Research Program on Policies, Institutions, and Markets (PIM
Evaluating the gendered credit constraints and uptake of an insurance-linked credit product
No full textSmallholder farmers in low- and medium-income countries lack sufficient access to agricultural production credit that can help them adopt new technologies and improve their farm production. Compared to men, women smallholder farmers face additional social, and economic barriers that further limit their credit access. Bundling agricultural credit with insurance, or risk contingent credit (RCC), provides a mechanism for addressing some of the credit access constraints and reducing credit rationing among smallholder farmers. In this paper, we evaluate the gendered determinants of credit rationing and the gender differences of the effects of RCC innovation on credit uptake decisions. We use three-wave panel data from a randomized control trial (RCT) in Kenya. We find that female-headed households (FHH) are significantly more risk rationed (or demand-side credit constrained) compared to male-headed households (MHH), however, the gender of the household head does not significantly determine the household quantity rationing status (supply-side constrained). We also find that farmers randomly assigned to be offered the RCC are up to four percent more likely to take up credit. RCC’s impacts on credit uptake decisions do not vary with the gender of the household head, however, RCC has a differential positive and significant impact on the credit uptake decisions of farmers that were previously (at baseline) risk rationed. Based on these findings, we suggest that policies should focus on reducing gendered demand-side barriers to credit access, especially among poorer women households. Climate financing innovations such as RCC should also be designed and delivered in a gender-inclusive manner to accommodate women farmers who face time, liquidity, and financial literacy barriers.Non-PRIFPRI1; 1 Fostering Climate-Resilient and Sustainable Food Supply; 4 Transforming Agricultural and Rural Economies; 5 Strengthening Institutions and Governance; G Cross-cutting gender theme; Capacity StrengtheningForesight and Policy Modeling (FPM); Transformation Strategie
Toolkit for cost-benefit analysis of climate information services: An outline
No full textThe Accelerating Impacts of CGIAR Climate Research for Africa (AICCRA) aims to support the development and scaling of the CGIAR’s most strategic and impactful climate change mitigation strategies across Africa. One of the main objectives of AICCRA is to facilitate the development, and evaluation of tailored climate information services (CIS) packages for small-scale farmers in the target countries. CIS involves the collection, organization, packaging, and distribution of targeted and timely weather and climate information, such as rainfall, temperature, wind, and soil conditions among others (Tall, et al. 2014). Under the AICCRA program, it is expected that farmers used the tailored CIS packages to make farm production decisions that will improve farm productivity and profitability, access to financial services, and risk-taking capacity. In addition, tailoring CIS to meet the needs of vulnerable groups such as women, and the youth is expected to have a direct impact on intra-household dynamics including resource and labor allocation, and household decision making. Collectively, these farm-level changes are expected to improve household long-term resilience to climate change, household food security, and individual sense of wellbeing and agency.
To better understand the individual and societal benefits of CIS, IFPRI is developing a toolkit that evaluates the costs and benefits of country-specific CIS packages. The toolkit will go beyond the conventional approach that measures the net present value of gains in farm productivity and profitability to evaluate impacts on a range of other outcome variables that are not traded in the market (for example, more stable and predictable income flows, improved women’s agency, reductions in workload and intra-household labor allocations, and changes in health and behavioral outcomes).Non-PRIFPRI5; 1 Fostering Climate-Resilient and Sustainable Food Supply; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food IndustryMTI
Gender-inclusive, -responsive and -transformative agricultural insurance: A literature review
No full textThis literature review uses a gender analysis framework proposed by Johnson et al. (2018) to explore the extent to which agricultural insurance reaches, benefits and empowers women and men. We find that most studies on gender and agricultural insurance focus on gender inclusivity by analyzing gender gaps in insurance reach and studying how to increase take-up among women. By contrast, limited attention has been paid to understanding gender equity in the distribution of insurance outcomes, that is, the extent to which insurance benefits and empowers women as much as men. We show that insurance programs can promote gender equity in benefits by providing quality insurance products that are beneficial to both men and women, and through long-term monitoring of individual outcomes measured within households using gender-disaggregated data. Insurance programs can support gender empowerment by ensuring that contracts purchased by women are registered under their names and payouts are subsequently paid to their accounts, by bundling insurance with empowerment programs, and by preserving and promoting informal mutual assistance group activities and membership. We then draw on a case study in Kenya to illustrate how this framework can be applied to design more gender-inclusive, -responsive and -transformative insurance schemes.Non-PRIFPRI1; CRP2; CRP7; G Cross-cutting gender themeMTID; PIMCGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS); CGIAR Research Program on Policies, Institutions, and Markets (PIM
