Climate Shocks and Social Networks: Understanding Adaptation among Rural Indian Households

Abstract

This paper seeks to uncover the impact of negative rainfall shocks on household social network relationships. I leverage the uncertainty generated from fluctuating long-term rainfall patterns across India, to estimate the impact of heightened climate risks on investments in social network relationships. In so doing, I attempt to disentangle the “direct” and “adaptive” impacts of climate shocks on social network relationships. I found that households that experience higher than average negative rainfall shocks (lower than average rainfall levels over the long term) tend to invest more in family–caste and vertical or linked network relationships. These network relationships were also found to be associated with greater access to financial credit, credit sourced specifically from family members, higher reported collaboration, more diversified businesses, and the use of private irrigation technologies, all of which are key to mitigating the negative impacts of climate shocks. Unlike past research, these results suggest that households’ decisions to invest in social networks may be an adaptive response to higher climate risk. In terms of policy implications, these results highlight the importance of strengthening and supporting family-based and linked networks (such as links to local governmental agencies and extension services) in the face of higher climate risks.