Global Livestock CRSP Pastoral Risk Management (PARIMA) Project

1. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project PROBLEM STATEMENT Pastoralists are exposed to many and increasing risks. Local systems are under stress and increasingly unstable. Pastoralist welfare is declining.

2. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Central Project Hypothesis: Improved capacity to mitigate risk and uncertainty at individual, household, community, and regional levels will improve the well-being of pastoral peoples and the quality of the natural and social environments on which they depend.

3. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project RESEARCH DESIGN Interdisciplinary. A mix of quantitative and qualitative approaches: quarterly surveys, case studies, and others. Multiple scales: Individual, Household, Community, National Temporal and cross-sectional comparisons Recording behaviors as well as perceptions

4. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Site Selection • 11 sites in the study region selected to represent variation in: • Country • Market Access • Ethnicity • Agro-ecology

5. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Site Selection in Kenya

6. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Site Selection in Ethiopia

7. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project • We originally began our research effort by identifying the following risks • Climate • Market • Insecurity • Animal and human disease

8. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Strategies to Reduce Risk Exposure Herd Accumulation Mobility Marketing Financial Savings Social Insurance Activity Diversification External Assistance

9. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Herd Accumulation – Original Hypothesis Herders traditionally self-insure through herd accumulation.

10. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Herd Accumulation – Research Methods • Repeated surveys • Oral histories of individual recovery patterns (species sequencing, use of market purchases, transfers, …)

11. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Herd Accumulation – Preliminary Findings Best predictor of post-drought herd size is pre-drought herd size and recovery is faster when you start bigger… accumulation is costly but effective insurance

12. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Herd Accumulation – Preliminary Findings

13. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Herd Accumulation – What Lies Ahead • Analysis of herd rebuilding and poverty dynamics: who recovers fast and how? Who gets trapped and why? • Use of species diversification and sequencing in herd rebuilding. • Intrahousehold variation: who loses the animals and who gets restocked quickly?

14. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project MOBILITY-Initial Hypothesis Primary traditional means of coping with spatial and temporal variability in forage and water availability Increasingly impeded by - cultivation of key terrain - violence and instability - growth of towns - gazetting of protected areas - localized range degradation

15. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project MOBILITY-Research Methods • Repeated Surveys • Baseline survey on past water point use and access restrictions • Case studies on resource tenure and resource conflicts

16. % Remote Camp Median Herd Size Change† Species Diversity* Water Point Use 41% -80% DG Low 4 87% 9% KA High 9 86% -55% LL Medium 7 8% -65% NG Medium 4 50% -19% NH High 5 30% -49% SM Medium 4 Global Livestock CRSP Pastoral Risk Management (PARIMA) Project MOBILITY-preliminary findings • Mobility is primary means to maintain herd size (Little and Mahmoud, 2000; Little et al. in press; Kenya Survey) * As measured by a squared TLU share index †Measured in Tropical Livestock Units (1 head of cattle = 0.7 Camel=10 sheep=11 goats)

17. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project MOBILITY-preliminary findings Ethiopia Data * As measured by a squared TLU share index †Measured in Tropical Livestock Units (1 head of cattle = 0.7 Camel=10 sheep=11 goats)

18. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project • Household level herd size differences influence mobility; larger herds are more mobile. (Little, in press; McPeak, in press; McPeak and Barrett, in press) • This can help explain observed localized degradation • This can lead to poverty traps

19. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Mobility – What lies ahead • Geo-referenced mobility patterns to examine how distance and herd size influence mobility • Analyzing data recording access rights to key resources • Case studies of changing resource access

20. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing- Initial Hypothesis Little use of livestock markets in response to shocks. Trader networks facilitate trade and reduce transaction costs. Poor market integration leads to low and volatile producer prices.

21. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing- Research Methods • Repeated Surveys. • Study of livestock trade and trader networks. • Analysis of GTZ livestock market data. • Study of livestock marketing institutions.

22. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing-preliminary findings Livestock prices covary positively with rainfall, so prices collapse when pastoralists most need to sell .

23. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing-Preliminary findings Quarantines affect cattle prices, creating a distributionally regressive means of livestock disease control. Source: Barrett, Chabari, Bailey, Coppock and Little (2001)

24. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing-Preliminary findings Livestock price volatility in northern Kenya is due primarily to variability in the difference between the local producer price and the Nairobi market price.

25. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing-Preliminary findings Different groups of traders, characterized by scale and ethnicity, have preferential access to different markets.

26. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing- Preliminary findings Table with Death rate, Sales rate, purchase rate By site, by period

27. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing- Preliminary findings

28. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Annualized Sales Rates are High, and correspond to Market Access

29. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Marketing- What lies ahead • Effects of conflict on livestock marketing. • Analysis of nature and effects of market power. • Differences in incentives to pastoralists between auctions and dyadic markets. • Analysis of the determinants of the pastoral marketing behavior. • Potential synergies between savings institutions and livestock marketing. • The influence of intra-household rights to animals on marketing behavior.

30. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Financial Savings- Research Hypotheses There is latent demand for financial savings. Conversion of pastoral wealth through financial savings will improve pastoral welfare by reducing risk of asset loss. Savings will lead to asset and income diversification.

31. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Financial Savings-Research Methods • Repeated Surveys • Interviews with FSA members, non-members, and management.

32. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Financial Savings-Preliminary findings Sharon Osterloh will present findings from her survey of micro-finance institutions in northern Kenya. Hussein Mahmoud will mention use of savings accounts by traders

33. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Financial Savings-Preliminary findings Kenya results below. In Ethiopia, only 2 sample households had accounts when we started, none do now.

34. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Financial Savings – What lies ahead • Relationship between household wealth and savings and credit behavior • Analysis of institutional design • Exploration of link between formal finance and income and asset diversification.

35. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Social Support Networks – Original Hypothesis Customary transfers between households of cash, food, and livestock help households and individuals cope with risk. Access to these networks varies across and within households.

36. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Social Support Networks – Research Methods • Repeated surveys • Focused survey and open-ended interviews on intra-household property rights and transfers

37. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Social Support Networks – Preliminary Findings Survey evidence from the Kenyan Gabra and Ethiopian Boran show livestock transfers are quantitatively very small. Livestock transfers depend on past transfer history. (McPeak 2001; Lybbert et al. 2001)

38. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Social Support Networks – Preliminary Findings Net cash transfers - Ethiopia Number indicates mean amount in birr over 9 month period 213 233 88 -371 84 -996 217 -285 -50

39. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Net Cash Transfers: Kenya Number above is in shillings over 9 month period 2270 761 2569 229 1071 4107 -964 -1571 -870 -203 -2216 -1262

40. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Social Support Networks – What Lies Ahead • Analysis of the role of inter-household livestock transfers in drought recovery. • Oral histories of changing support mechanisms. • Explore relationship between nonpastoral income and cash transfers, food security and restocking. • What is the role of interhousehold food transfers in enhancing food security.

41. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Activity Diversification – Original Hypothesis Asset and income diversification are key ways to improve risk management by pastoralists.

42. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Activity Diversification – Research Methods • Repeated surveys • Focus group interviews • Interviews with entrepreneurs

43. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Activity Diversification – Preliminary Findings • Much activity diversification has been ex post coping among the poor (“push” not “pull”). (Little et al. 2001). • Those with education and/or good market access enjoy ex ante diversification yielding higher incomes. • Women have different and worse opportunities. • Salaries have a stabilizing effect.

44. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project

45. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project

46. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Activity Diversification – Preliminary Findings

47. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project

48. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project Activity Diversification – What Lies Ahead • Osterloh thesis research on the potential of nonpastoral activities to support households and financial systems. • Identification of which types of diversification increase risk exposure and reduce welfare and which types mitigate risk and improve welfare. • Role of activity diversification in assisting drought recovery.

49. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project External Assistance: Original Hypothesis Pastoral populations growing increasingly dependent on disaster relief, yet neglected by service providers. Much previous pastoral development assistance was misdirected.

50. Global Livestock CRSP Pastoral Risk Management (PARIMA) Project External Assistance: Research Methods • Repeated survey • Action research • Extensive review of secondary literature