Title : Impact of Climate Change on Labour Markets and Women's Poverty in Bolivia
Abstract:
Bolivia is a South American country which, given its socio-economic and geographical conditions, is highly sensitive in a context of climate change. In addition, it is a country characterized by problems such as poverty and inequality, which particularly affect the rural population. Likewise, strong gender biases can be found in the labour market, where women tend to be less involved. Working in a narrow range of sectors and being the majority in unpaid activities, Bolivian women are highly vulnerable, and their situation could become even worse in a context of climate change, where sectors such as agriculture or livestock in which women are involved, could suffer serious consequences. This study aims to analyse the effects of climate change on labour markets and women’s poverty in Bolivia using a general equilibrium model (CGE) as methodology. Although CGE models are increasingly used to assess the effects of climate change, all studies focus exclusively on the market economy, leaving aside the domestic market, so there is a tendency to overestimate or underestimate macroeconomic effects, as the models assume that the work categories are homogeneous. This paper contributes to the application of CGE models by introducing domestic production to assess the impact of climate change. Unlike the classic model in which the labour supply is fixed, we propose an endogenous labour supply which will depend not only on the time that households devote to their formal market activities, but also to domestic activities. Thus, it will be possible to analyse the effects of our climate scenarios taking into account the interrelationships between labour supply in the formal and domestic market. Likewise, the CGE model will be linked to a micro simulation module that integrates gender decomposition. The objective of developing this module is to determine the impact of CGE macroeconomic outcomes on the evolution of poverty and inequality.
We propose two scenarios. The first scenario is about the damage and losses due to climatic events in the agricultural and livestock sectors. In the model this shock is introduced exogenously affecting the capital production factor. In addition, this scenario will take into account the variation in international prices as a result of climate change. In the second scenario, we analyse a reduction in agricultural production as a consequence of climate change. For this, we will specifically rely on the IPCC projections, and the CEPAL 2014 estimations for Bolivia for consider a decrease in production yields in two types of agriculture: Modern and Traditional.
