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This short note attempts to summarise the discussion so far, and to pull out
new themes for the next round of discussions.
The two main (and related) points that I propose for further discussion are
inspired in part by Czech Conroy's contribution (see below) and are the
following:
i. how much do we know about whether/how poor people use
assets they own (or to which they have access) as vulnerability-reducing
measures in response to shocks and stresses. Are these assets essential to
their production processes, or in some sense "surplus" to basic production
requirements? If technological change could be introduced to improve the
quality of some of these, this would increase their resilience. Similarly, a
better enabling environment might avoid prohibiting the sale of certain
assets such as trees on private land.
ii. Do we have examples of opportunities that people have
taken to dispose of assets in times of crisis, or of what has prevented them
from doing so (e.g. inadequate enabling environments), drawing out
conclusions on appropriate types of policy intervention - technological,
enabling environment, or any other kind?
Discussion on this site has been small in quantity but high in quality so
far. Many thanks to all who have contributed. Here's my attempt to summarise
some of the main strands of argument to date.
First, a clarification on the difference between risk and vulnerability, in
response to one of Dirk Bezemer's emails: as I see it, the difference is
this:
Risk is the likelihood of occurrence of a particular and potentially adverse
event (such as a drought or flood). Risk prevention or mitigation would
therefore be done at the broad level of, for instance, breeding
drought-resistant crops, or setting up large-scale irrigation systems.
Vulnerability is the degree of exposure of individual households or
individuals to such events, and their ability to prevent, mitigate or cope
with the event. Vulnerability reduction would therefore be done at the level
of one or a group of households - by increasing their asset base, increasing
their ability to access irrigation or new varieties, and so on.
But there is also - as Elizabeth Cromwell rightly points out - a set of
factors not related to risk ("stresses" in some writings) which also
contribute to vulnerability, including gender, age, belonging to minorities
etc. She asks whether coping strategies can be better understood and
supported through such measures as improved vulnerability assessment
indicators. But also suggests that capacities to mitigate and reduce risk may
be achievable only through broader policies focusing on e.g. reduced social
exclusion.
Vinay Chand's two interventions raise a number of interesting points: farmers
can generally cope with one bad season, but how can they best be supported to
cope with a succession of two or three? On price shocks, if these are
cyclical, then commodity price stabilisation funds might be a good way of
tackling them, but the reality is that the skills to manage these adequately
are rarely found in the public sector. If they are idiosyncratic, then buffer
stocks might be a better mechanism, but these are typically costly to
administer. There are, though, possibilities of contracting certain services
out to the private sector, including warehousing and quality control.
Laurent Chazee stresses the importance of off-farm employment as a
diversification (and risk-reduction) strategy. Like Elizabeth Cromwell, he
points to a non-risk factor likely to increase vulnerability - in this case,
traditional (male-line) inheritance systems that disadvantage women. He asks
how far agriculture can be an engine of growth in circumstances such as those
currently prevailing in Nepal, where the Maoist insurgency adds a new and
very powerful dimension of risk and vulnerability.
A different aspect of risk and vulnerability is taken up by Diana Lee-Smith:
many rural people reduce risk by moving to towns, or their peripheries. But
to practise agriculture here may expose them to other kinds of risk,
including risks to human health. She draws attention to a model developed by
CIP which allows the trade-offs between yield increase and human health to be
assessed. On a positive note, she notes the results of studies indicating
that child nutrition is better in households practising urban agriculture
than in other urban households.
The role of markets in helping to reduce risk and vulnerability is new
dimension of the debate introduced by Dirk Bezemer. On the one hand,
globalisation and liberalisation have profoundly altered market structures
and permitted the transmission of greater price instability. On the other,
markets can help to store wealth, and for this and for the more obvious
reasons, improved access to markets is potentially important for poor people.
This raises the further question of whether and how some of the virtues of
parastatals and other arrangements could be revived, without the problems of
rent seeking and inefficiency that they posed.
James Biscoe raises a number of questions, including that of whether and how
we should focus on stabilising economic returns if, as seems plausible, these
are more volatile than physical yields. He also asks whether banks can
replace parastatals, since, like parastatals, they too must help in
satisfying the "output" question of prices and yields on investment, so that
clients can be sure of being able to afford the necessary inputs.
Czech Conroy takes the discussion in a number of innovative directions. He
suggests that people's assets (that they either own or to which they have
access rights) are an important part of traditional protection measures
(since they can easily be liquidated), but are little understood. For
instance, with privately owned assets such as chickens, mortality is high and
hatching performance often low. Technological improvements here could help in
enlarging this asset base. Similarly, trees grown on private land may be
potentially an important source of social protection, but this role is
impaired if regulations prevent the cutting of trees even on private land.
Further, in relation to access to the commons, rights of access are often
very poorly defined. There are thus both technological and "enabling
environment" improvements that can be made so that these traditional assets
become more useable as vulnerability reducing measures.
Please visit dfid-agriculture-consultation.nri.org.