Risk and Insurance: Perspectives on Fertility and Agrarian Change in India and Bangladesh

Abstract

Relative to other approaches and emphases -- the value of childrens labor for example -- the potential importance of environmentally and socially determined risk as a source of derived demand for children in poor agrarian settings has been largely overlooked. Using frequency of distress sale of land as an indicator of the adequacy of insurance mechanisms this article compares sources of risk and means of insurance in rural Bangladesh (represented by the village of Char Gopalpur) and a semi arid area of south central India (represented by 2 villages in Maharashtra and 1 in Andhra Pradesh). While both regions are characterized by harsh environment of risk in the Indian setting efficient adjustment mechanisms have evolved -- particularly capital markets and public relief employment -- that have partially neutralized risk prefvented the distress sale of land and greatly reudced the need for the insurance that children could otherwise provide. No comparable mechanisms exist in the Bangladesh setting and thus the value of children remains high. It is suggested that regional differences in environments of risk and sources of insurance within South Asia may go far to explain regional differences in recent fertility trends. (authors) (summaries in ENG FRE SPA)