#EconTwitter I'm delighted that an early release of my paper "Rainfall Variability, Child Labor, and Human Capital Accumulation in Rural Ethiopia" is now available on the @AJAE_AAEA website. A short 🧵 https://twitter.com/AJAE_AAEA/status/1298256925474226180
This paper has been a labor of love. I started it back in 2012 as a course paper during my Ph.D. Even then there were a lot of rainfall shocks papers (income shocks). I wanted to think about income uncertainty.
Theoretically, the effects of an increase in income uncertainty are unclear (precautionary savings reduce education investments vs. income diversification motives). But empirically, identifying the effects of income uncertainty is hard (did I mention I started this back in 2012).
Using child-level panel data, I look at how a medium-run change in mean-preserving rainfall variability affects child labor and human capital investments. I find that an increase in rainfall variability (my proxy for income uncertainty) reduces child labor & increases schooling.
"But rainfall variability is correlated with rainfall shocks. Why do you think this captures uncertainty?" said everyone. Well, I show that rainfall variability has no effect on past, present, or future rainfall, nor income, wealth, and agricultural outcomes.
Of course, one can never rule out any residual effect, but I think that any residual "income shock" effect is not a first-order concern in this context. The 80-page appendix is available if you want to go down that rabbit hole :-)
All in all, I'm delighted that the paper has found such an amazing home. The process was fast, @marcfbellemare was an amazing editor, and the referees were incredibly helpful and gracious. You should all submit your ag/env/dev work to @AJAE_AAEA!
You can follow @JonathanColmer.
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