Tag Archives: Resilience

By: Lykke E. Andersen*

Even the most affluent and powerful people in the World are exposed to the risk of adverse shocks and stresses: Christopher Reeve (Superman) became a quadriplegic after a riding accident; Nelson Mandela was imprisoned for 27 years; Mel Gibson had to pay more than $400 million in his divorce settlement; Steve Jobs got fired from his own company; and Donald trump has declared bankruptcy four times.

We are all at risk of adversity, or even calamity, and the list of threats is endless: Natural disasters, illness, accidents, unemployment, price fluctuations, conflict, vandalism, fire, robbery, pest attacks, technological change, pollution, climate change, etc. Most of these threats are almost entirely outside our control and it is important that we build up resilience against them so that we will be able to overcome the challenges that we are bound to encounter.

Some people and households are more resilient than others, however. They bounce back even after severe adversity. Nelson Mandela, for example, became one of the most famous and respected presidents in the World and was awarded the Nobel Peace Prize after spending 27 years in prison; Christopher Reeve claimed that the accident, which left him paralyzed from the neck down, helped him appreciate life more and considered himself a very lucky man less paralyzed than many able-bodied men; and Donald Trump evidently rebuilt his fortune between bankruptcies.

While resilience is an integral part of the human psychology, it would be useful if we could measure and compare resilience in a more general way. This is what a new research paper and Policy Brief from INESAD proposes.

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Leerlo en español AQUI  

Adverse shocks can take many forms: Natural disasters, climate change, illness, unemployment, technological change, price fluctuations, conflict, vandalism, fire, robbery, pest attacks, accidents, etc. The list is endless, and it is important for households to build up resilience against all of these, so that they will be able to overcome the adverse shocks that will inevitably happen from time to time (Andersen & Cardona, 2013).

An important strategy for coping with risk is livelihood diversification (Ellis, 2000; Ellis and Freeman, 2005). The greater the diversity of income, the greater the resilience of livelihoods to disruption from any particular source (Adger 1999).

Andersen & Cardona (2013) proposes a simple measure of livelihood diversification, interpreting it as the opposite of livelihood concentration. Thus, it is simply measured as one minus the widely used Herfindahl–Hirschman Index of Concentration.

Using this simple measure, they have estimated the level of livelihood diversification for all Bolivian households in the 2011 national household survey conducted by the National Statistical Institute. They then combined this information with information about the level of income, in order to identify highly resilient households (high income and high diversification) and highly vulnerable households (low income and low diversification). See figure 1.

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