Adaptation to Natural Disasters through the Agricultural Land Rental Market: Evidence from Bangladesh

Shaikh M.S.U. Eskander and Edward B. Barbier

Abstract

We examine the effects of natural disaster on agricultural households who make rent-in or rent-out transactions. Our econometric approach accounts for the effects of disaster-exposure both on the adjustments in the quantity of operated land and agricultural income conditional on the land quantity adjustments. Using a household survey dataset from Bangladesh, we find that farmers were able to partially ameliorate their losses from exposure to disasters by optimizing their operational farm size through these land rental transactions. Land rental market may be an effective instrument in reducing disaster risks, and post-disaster policies should consider this role more systematically.

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