Health Shocks and Natural Resource Management: Evidence from Western Kenya

32 Pages Posted: 13 Dec 2010

See all articles by Joshua Graff Zivin

Joshua Graff Zivin

University of California, San Diego (UCSD) - Graduate School of International Relations and Pacific Studies (IRPS); National Bureau of Economic Research (NBER)

Maria Damon

Independent

Harsha Thirumurthy

University of Pennsylvania; Center for Health Incentives and Behavioral Economics, University of Pennsylvania

Date Written: December 2010

Abstract

Poverty and altered planning horizons brought on by the HIV/AIDS epidemic can change individual discount rates, altering incentives to conserve natural resources. Using longitudinal data from household surveys in western Kenya, we estimate impacts of health status on labor productivity and discount rates. We find that household size and composition are predictors of whether the effect on productivity dominates the discount rate effect, or vice-versa. Since households with more and younger members are better able to reallocate labor to cope with productivity shocks, the discount rate impact dominates for these households and health improvements lead to greater levels of conservation. In smaller families with less substitutable labor, the productivity impact dominates and health improvements lead to greater environmental degradation.

Suggested Citation

Graff Zivin, Joshua and Damon, Maria and Thirumurthy, Harsha, Health Shocks and Natural Resource Management: Evidence from Western Kenya (December 2010). NBER Working Paper No. w16594, Available at SSRN: https://ssrn.com/abstract=1723042

Joshua Graff Zivin (Contact Author)

University of California, San Diego (UCSD) - Graduate School of International Relations and Pacific Studies (IRPS) ( email )

9500 Gilman Drive
La Jolla, CA 92093-0519
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Maria Damon

Independent

Harsha Thirumurthy

University of Pennsylvania ( email )

423 Guardian Dr
Philadelphia, PA 19104
United States

Center for Health Incentives and Behavioral Economics, University of Pennsylvania ( email )

Philadelphia, PA 19104
United States

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