Abstract

Risk coping is a severe challenge for households in developing countries, particularly for farm household because income is stochastically variable and credit markets are incomplete. Because of lack of formal systems to cope with risk, households rely on informal arrangements such as migration and marriage. This paper contributes to the literature of risk-coping strategies by examining how migration and marital arrangements serve to mitigate income risk and facilitate consumption smoothing in rural Burkina Faso, a low-income country characterized by rainfall variability in conjunction with very low income levels and a pressing need for consumption-insurance. The findings suggest that households cannot smooth consumption via assets transactions because markets work imperfectly. Households rely on self insurance arrangements to smooth consumption through inherited wealth, marriage and migration.

Key words: Consumption smoothing, risk sharing, marital arrangements, migration.