Drought is a significant problem that affects rainfed agriculture in many parts of South Asia and Africa. While it is well known that drought has negative impacts on producers, the impacts of drought on farm workers are not as well understood. Given that farm workers rely critically on an abundant harvest for work opportunities, and that their geographical mobility is notably low, technologies that stabilize harvests can in theory impact farm workers positively - one of the most marginalized populations.
We ask whether new drought-tolerant rice varieties have impacts on local labor markets. Specifically, can these technologies provide insurance to landowners and at the same time provide insurance to the landless laborers? In a well-known article, Jayachandran (2006) showed that weather-induced productivity shocks in Indian villages translate into large decreases in wages due to inelastic labor supply. Sharp fluctuations in wages in response to weather shocks thus help insure landowners at the cost of farm workers. If reducing the magnitude of these shocks with technology also affects labor markets, then this study will demonstrate that the effects on labor markets need to be considered when measuring the aggregate beneficial impact of these new agricultural technologies. Risk-reduction via technological change may thus make a major contribution to reducing vulnerability and poverty among the most marginal rural inhabitants.
Wages are the main channel of impact for the population of farm workers. Therefore, measurement of local wages will be of first-order importance for the study. We will also measure labor supply effects. For landowners, we will measure productivity gains at the plot level. We can therefore estimate the direct impact of the technology on them. In addition, we will measure labor demand for a variety of production stages from land preparation to harvesting. We expect to measure additional outcomes - both for the population of landowners and landless laborers. In particular, we will measure aggregate income, consumption, and school attendance of children.