Resource information
This paper studies the use of labor
markets to mitigate the impact of violent shocks on
households in rural areas in Colombia. It examines changes
in the labor supply from on-farm to off-farm labor as a
means of coping with the violent shock and the ensuing
redistribution of time within households. It identifies the
heterogeneous response by gender. Because the incidence of
violent shocks is not exogenous, the analysis uses
instrumental variables that capture several dimensions of
the cost of exercising terror. As a response to the violent
shocks, households decrease the time spent on on-farm work
and increase their supply of labor to off-farm activities
(non-agricultural ones). Men carry the bulk of the
adjustment in the use of time inasmuch as they supply the
most hours to off-farm non-agricultural work and formal
labor markets. Labor markets do not fully absorb the
additional labor supply. Women in particular are unable to
find jobs in formal labor markets and men have increased
time dedicated to leisure and household chores. Additional
off-farm supply does not fully cover the decrease in
consumption. The results suggest that in rural Colombia,
labor markets are a limited alternative for coping with
violent shocks. Thus, policies in conflict-affected
countries should go beyond short-term relief and aim at
preventing labor markets from collapsing and at supporting
the recovery of agricultural production.
