Rainfall Shocks, Health and Well-being in Rural Vietnam

Abstract

This study examines how rainfall shocks influence self-perceived health conditions and subjective well-being among Vietnamese rural residents. To estimate the effects of interest, we adopt the individual fixed effects model that exploits the within-individual variation in rainfall shock exposure. We uncover the harmful impacts of rainfall shocks on individual health and subjective well-being. Particularly, a 100% increase in rainfall relative to the district-specific norms make individuals 14.3 and 14.6 percentage points less likely to report themselves to be healthy and healthier relative to last year, respectively. They are also 13.7 and 5.5 percentage points less likely to consider themselves wealthy in comparison to other residents in their villages and Vietnam, respectively. We further show that individuals working in both agriculture and non-agriculture industries are adversely affected by rainfall shocks, but the impacts are larger in magnitude for the agriculture group. The findings suggest that effective measures from the government and households are required to alleviate the costs of climate volatility such as rainfall shocks. JEL Classifications: I15, J13, O15, Q54