Natural Shocks and Risk Behavior: Experimental Evidence from Cameroon

Increasing occurrence of devastating natural shocks has stimulated research interest in the economics of natural disasters. Much of this scholarly work concentrates on effects of shocks on poverty, risk and vulnerability, and very little on understanding the effects of natural shocks on risk behavior. Referring to a 24 year-old disaster, we use unique survey data and experiment results from two disaster affected communities in rural Cameroon to test two hypotheses: (1) Natural shocks affect long term risk behavior; and (2) self-relocation into risk-prone areas is an explicit demonstration of risk taking. The results reveal differentiated risk behavior in self-relocated and stateresettled households, with the former taking higher risks compared to resettled households. Experiments strongly support trends observed in the empirical study, but captured cognitive behavior better than the survey. Results support previous evidence on applying experiments in understanding cognitive risk behavior and confirm our hypotheses.


Issue Date:
2011
Publication Type:
Journal Article
DOI and Other Identifiers:
ISSN 0049-8599 (Other)
PURL Identifier:
http://purl.umn.edu/155530
Published in:
Quarterly Journal of International Agriculture, Volume 50, Number 2
Page range:
155-173
Total Pages:
19
JEL Codes:
C93; D81; Q12; Q28; Q54
Series Statement:
Quarterly Journal of International Agriculture 50 (2011)
2




 Record created 2017-04-01, last modified 2017-08-27

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