Issues and Methods in Livelihoods Analysis

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Vocations Concepts. ObjectivesResourcesLaborLandCapitalTechnologiesConstraintsTenureCredit. 2. Essential exploration concern. Portraying conduct is great Explaining conduct is betterUnderstanding why practices contrast crosswise over family units is bestWe need to comprehend not just WHAT

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Issues and Methods in Livelihoods Analysis Gerald Shively Purdue University shivelyg@purdue.edu Prepared for the CIFOR/PEN Annual Meeting, January 11, 2008, Barcelona

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Objectives Resources Labor Land Capital Technologies Constraints Tenure Credit Livelihoods Concepts

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Describing conduct is great Explaining conduct is better Understanding why practices differ crosswise over family units is best We need to comprehend WHAT… as well as WHY Primary research concern

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What does the family unit crave? Benefit amplification Food security Risk evasion Wealth aggregation Food deals Food buys The appropriate response has suggestions for models, solutions and expectations Objectives

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Land Labor Working capital Why concentrate on distribution? This is a zero-whole prospect: designating an asset to one action blocks dispensing it to another Most monetary exercises have substitutes What can families distribute?

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Traditional versus current Embedded versus bodiless Does it work? How well does it function? Is it accessible? Is it versatile? Is it distinct? Is it one-sided? Specialized versus financial contemplations Households likewise pick advances

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Differences are great Variance in the information is great This change is the thing that permits one to comprehend why diverse circumstances, inspirations, and requirements prompt to various results. Heterogeneity is your companion

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Good place to start Identify "Essential Needs" versus "Supply Systems" Direct linkages crops + animals + money  nourishment Indirect linkages crops + backwoods + work  money Analytical concentration: targets; implies; execution; issues; arrangements Diagnostic/Heuristic Approach (Ashley 2000; Raintree/NAFRI 2005)

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More formal approach Identify data sources, procedures, and results Capital and resources Transforming structures and procedures (counting strategies and organizations) Asset/Vulnerability Approach (Castro 2002; DIFD 1999) Outcomes

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Typically has a managing structure, however regularly determined as a decreased frame: y=f(x) Dependent (lhs) factors results (pay, uses) decisions (work assignment, arrive utilize, innovation) Independent (rhs) factors exogenous factors assets, parameters, requirements Econometric approach

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Lets expect that yield relies on upon work info and innovation Yield (kg/ha) = b 0 + b 1 *labor input (days/ha) + b 2 *technology pointer Let marker for the new innovation be 0/1 In the relapse b 2 will quantify the avg. effect of the new innovation on yield. Illustration: Agricultural Yield

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Does b 2 truly measure the effect of the new innovation on farming yield? Where does work originate from? Do a few employments of work dislodge different utilizations (e.g. rivalry between off-homestead & woods)? Connection versus causation Omitted factors Hidden causes Endogenous regressors Some challenges

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Instrumental variable procedures 2 phases, 2 nd depends on results from 1 st Seemingly Unrelated Regressions (SUR) Structural frameworks of conditions utilize clear imperatives to shape relapses Natural analyses Potential arrangements

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2SLS 1 st organize: innovation decision relies on upon ??? 2 nd organize: yield relies on upon innovation decision Seemingly Unrelated Regressions (SUR) Technology decision and work portion in parallel relapses Structural frameworks of conditions Labor shares, each with it's own relapse Natural test Exogenous irregular task of new innovation Examples

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- ∞ ≤ y ≤ +∞ linear relapse 0≤ y ≤ +∞ OLS or 1-tail Tobit 0≤ y ≤ 1 2-tail Tobit 0 or 1 Probit or logit Measurement of factors and decision of method

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Ashley, Caroline (2000) Applying Livelihood Strategy Approaches to Natural Resources Management Initiatives: Experiences in Namibia and Kenya. Working Paper 134. London: Overseas Development Institute. Castro, A. Dwindle (2002) Sustainable Livelihoods Analysis: An Introduction. Paper introduced at meeting "Open Goods and Public Bads in Nature: From Landscapes to Genomes in South Asia." Syracuse and Cornell Universities, February 23, 2002. DIFD (1999) Sustainable Livelihoods Guidance Sheets. London: Department for International Development. Raintree, John (2005) Livelihoods Analysis: A Checklist. In Improving Livelihoods in the Uplands of the Lao PDR. NAFRI, NAFES, NUOL. References

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