Are traditional coping mechanisms effective in managing risk against extreme events? Evidences from a flood prone region in rural India

November 30th, 2015

Dr. Unmesh Patnaik (Tata Institute for Social Sciences, Mumbai) & Prof. K. Narayanan (Indian Institute of Technology Bombay, Mumbai)

A growing body of literature in the past two decades has examined climate change as an important issue in the global environment and analyzed the impacts of climatic extremes on the vulnerability of the rural poor. Findings from the IPCC indicate that climate change will have an adverse impact across regions with variability in the nature and scale of impacts and that developing nations will be worse affected1. For India, the initial National Communication to the United Nations Framework Convention on Climate Change (UNFCCC) states that in recent years, the vulnerability of rural households located in disaster-prone regions of India has increased mainly due to climate change related factors like higher intensity of floods2.

Risks associated with these extreme events can cause devastating environmental and socioeconomic losses3 with the poor bearing the greatest risk of the negative impacts due to their limited coping capacities as well as their higher physical vulnerability4. Therefore, from the point of view of economies like India, where a majority of the population lives in rural areas, there is a need to understand the impact of these events on the livelihoods and the efficiency of traditional coping mechanisms in reducing the risks from climatic extremes, like floods and hurricanes etc.

A number of Indian states are prone to natural disasters. The eastern region in the state of Uttar Pradesh (UP) bordering Nepal has been historically prone to floods, with major floods (in terms of area inundated and people affected) occurring every 10 years and smaller ones every 1-2 years5. The flood-affected area in eastern UP accounts for around 29% of the area of the state. The Rohini River, a part of the Gangetic Basin, which has its headwaters in the Nepal Terai region, is primarily responsible for floods in this region due to cloudbursts and intense rainfall events in Nepal.

This research attempts to examine the risks faced by rural households on their livelihoods in this vulnerable region due to the recurring floods and investigate the effectiveness of coping mechanisms adopted by the people. In doing so household level data is used, collected through primary surveys in Gorakhpur and Maharajganj districts in eastern UP. As the nature of impacts due to flooding varies with respect to the location of households (for example, households in closer proximity to rivers and embankments are at a greater risk than those far off), sample households are chosen in diverse locations (upper, middle basins and the tail end) to capture the variability in impacts.

Based on a quantitative approach, two sets of econometric analysis are undertaken: (i) the impact on livelihoods is analysed by studying the consequences of floods on the consumption patterns of the households through a logistic regression6,7 and (ii) effectiveness of coping mechanisms is examined by quantifying the ex-post coping behaviour of the sample through a risk sharing framework8,9. The former elucidates the impact on the consumption level and the reasons for observed changes, if any. While the latter reveals the reasons for adopting four major coping mechanisms (interest free monetary transfers from different sources, selling of livestock, use of credit with interest, and government relief) by the household samples.

The results suggest that the observed reduction in the consumption level after the floods is due to the reduction in household income level and the damages suffered by agriculture and housing implies a lack of insurance for physical assets and income stability. It also emerges that richer households adjust their consumption more and the presence of children inhibits changes in consumption behaviour.

Results from the econometric analysis suggest that the adoption of a particular coping mechanism or adoption of a mix of measures depends on the nature of losses caused by the floods. For instance households do not depend on monetary transfers to meet additional health expenditure but use it for meeting the occupational shifts required during the post-disaster phases. Likewise households with migrants and those with higher levels of education (around 15 years) rely on this measure but there also exists a life cycle effect as families with older heads of the household don’t resort to this mechanism.

Government relief is deployed as a means to cover up the loss in consumption and occupational stress, with the location of the household being a determinant for adoption of this instrument. Households in the upper and the lower parts of the river basin and those with higher income use relief as a coping strategy. Similarly, households resort to selling off livestock to cover the occupational loss. This effect is not observed in households with higher education levels because access to greater employment and livelihood diversification opportunities leaves household wanting to maintain the level of livestock.

The use of credit with interest is also deployed as a coping mechanism in the study area. Specifically it emerges that households with land and migrants are likely to use borrowing as a coping strategy, suggesting collateralized lending and the role of remittances respectively. There is evidence of complementarities in adoption coping strategies: households who gain from monetary transfers from friends and relatives also resort to government relief as a means of coping10.

Findings from this study call for amalgamation of development interventions with disaster risk reduction policies at a macro level. In the Indian context the key is to undertake activities under employment guarantee schemes, housing programmes and regional development grants that enhance disaster risk reduction and introduce effective flood and water management systems, which in turn will be helpful in raising the adaptive capacity of households in vulnerable regions.

References:

IPCC. 2014. Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change Core Writing Team, R.K. Pachauri and L.A. Meyer (eds.). IPCC, Geneva, Switzerland, 151. NATCOM (2004). India’s Initial National Communication to the United Nations Framework Convention on Climate Change. Ministry of Environment and Forests. Government of India, New Delhi. Mechler, R. (2004). Natural Disaster Risk Management and Financing Disaster Losses in Developing Countries. Verlag Versicherungswirtschaft, Karlsruhe. Benson, C. & Clay, E. (2004). Understanding the Economic and Financial Impacts of Natural Disasters, Disaster Risk Management Series. The World Bank, Washington, DC. Moench, M., Fajber, E., Dixit, A., Caspari, E. & Pokhrel, A. (2008). Catalyzing Climate and Disaster Resilience: Processes for Identifying Tangible and Economically Robust Strategies. Final Report of the Risk to Resilience Study. The Risk to Resilience Study Team, Kathmandu, Nepal. Cochrane, J. (1991). A simple test of consumption insurance. Journal of Political Economy 99(5), 957-976. Ravallion, M. & Chaudhuri, S. (1997). Risk and insurance in village India: comment. Econometrica 65(1), 171-184. Deaton, A. (1991). Saving and liquidity constraints. Econometrica 59(5), 1221-1248. Sawada, Y. & Shimizutani, S. (2007). Consumption insurance against natural disasters: evidence from the great Hanshin-Awaji (Kobe) earthquake. Applied Economics Letters 14(4), 303-306. Patnaik, U., & Narayanan, K. (2015). Are Traditional Coping Mechanisms Effective in Managing the Risk against Extreme Events? Evidences from Flood Prone Region in Rural India. Water Policy, 17(4), 724-741 (IWA Publishing). doi: 10.2166/wp.2014.065

Unmesh Patnaik is Assistant Professor at the School of Habitat Studies, Tata Institute of Social Sciences, Mumbai, India. His research interests include applied econometrics, development economics, urban economics and vulnerability and adaptation to natural disasters and climate change. Narayanan is a Professor of Economics at the Department of Humanities and Social Sciences, Indian Institute of Technology Bombay, Mumbai, India. His research interests include development economics, industrial economics, international business, industry-environment linkages and socioeconomic impacts of climate change.

The views expressed in this article belong to the individual authors and do not represent the views of the Global Water Forum, the UNESCO Chair in Water Economics and Transboundary Water Governance, UNESCO, the Australian National University, or any of the institutions to which the authors are associated. Please see the Global Water Forum terms and conditions here.