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Accueil du site → Doctorat → États-Unis → 1989 → Sequential decisions under uncertainty and labor market failure : A model of household behavior in the African semi-arid tropics

University of California, Berkeley (1989)

Sequential decisions under uncertainty and labor market failure : A model of household behavior in the African semi-arid tropics

Fafchamps, Marcel

Titre : Sequential decisions under uncertainty and labor market failure : A model of household behavior in the African semi-arid tropics

Auteur : Fafchamps, Marcel

Université de soutenance : University of California, Berkeley

Grade : Doctor of Philosophy (PhD) 1989

Résumé
Using household survey data collected in Burkina Faso, this study starts with stylized facts about the African semi-arid tropics : agricultural labor is unevenly distributed over a short agricultural season ; there is hardly any use of non-household manpower by small farmers ; the weather is erratic and farmers adapt their crop strategies accordingly ; and labor is the major flexible factor of production. A household model is then built with no labor market, sequential decisions, and uncertainty, and new theoretical concepts are developed : precommitments, flexibility, and multi-period risk aversion. We show that precommitments and missing markets tend to generate risk aversion, and that the sign of the relationship between external shocks and consumption decisions depends on the elasticities of substitution in production and consumption. Maximum likelihood estimates of the parameters of a stochastic, multi-period, non-linear-quadratic household model are estimated for three agro-climatic zones of Burkina Faso. Using those estimates, the impact of technological innovations on household behavior and welfare is simulated. Uncertainty and the absence of labor market are shown to dramatically reduce the responsiveness of farming households to market incentives, thus explaining the apparent sluggishness of African farmers often imputed to their asserted lack of economic rationality. They also reduce the profitability of any type of technological change. The financial cost of new technologies threatens the survival of poor households dependent on an unpredictable environment. Consequently alternative sources of cash income are essential determinants of technology adoption because they insure the household against bankruptcy. Household labor shortages occur when the state of nature is good or when the household makes excessive production plans. They prevent the household from reaping all the benefits of technological innovations. Technological innovations are much less attractive if, as is sometimes claimed by African farmers, they induce a loss of flexibility. Similarly, less flexibility reduces responsiveness to market incentives in most cases. Finally, land saving technologies are penalized because they are embedded into a factor of production which level cannot be adjusted over the agricultural season and are therefore less flexible than technologies that enhance the productivity of the flexible factor, labor.

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