Spending,saving, or investing? Risk management in sixteenth‐century Dutch households1

In the past one of the main challenges to households was that of coping with adversity. War, plague, famine, and flood were a constant threat, and could reduce what little improvements families had made in productivity. Economic growth therefore required a means of absorbing external adversities. To see how well late medieval households coped with adversity, this investigation focuses on the households of a small town and its surroundings in early modern Holland. Our findings reveal that several severe external shocks around 1500 had little effect on the general level or distribution of wealth, which suggests that certain forms of insurance may have protected the population. The results show that households increasingly invested in capital markets rather than employing such techniques as scattered holdings and hoarding. This fact indicates that such investment played a vital role in a household's risk aversion strategy. The change from unproductive to more productive risk‐aversion strategies also provides some clues about progress with respect to insurance during Holland's financial revolution.     

Does “Participation” in Common Pool Resource Management Help the Poor? A Social Cost–Benefit Analysis of Joint Forest Management in Jharkhand,India

Joint Forest Management (JFM) has succeeded in halting forest degradation in India, but its poverty reduction objective has not fully been evaluated previously. This paper compares JFM forests and government-managed forests to assess their respective net social benefits to different groups of local villagers. It shows that the JFM regime reflects the social preference of the rural nonpoor, and that the poor are net losers over a 40-year time horizon. Future plans for JFM need to include suitable compensatory mechanisms to reduce the poverty of the poorest within a village.