Informal associations, shocks, and household food consumption: panel data estimation from rural Nigeria

Abstract

ABSTRACTWe use the three-waves panel data for households in rural Nigeria from the General Household Surveys (GHS), which is part of the World Bank Living Standards Measurement Study – Integrated Surveys on Agriculture (LSMS-ISA), to investigate how informal associations help households that are exposed to adverse shocks in smoothing their food consumption. We find that informal associations help to improve the percentage of food expenditure and dietary diversity of households who are members compared to those non-member households. Moreover, we investigate potential mechanisms through which these relationships hold, and we find that households are able to borrow from both the association and other individuals who may be members of similar networks. Our results are robust to different specifications.