Climate Variability, Crop Diversification and Rural Household Welfare: Evidence From Senegal

ABSTRACT In this study, we investigate the impacts of crop diversification on food and nutrition security as well as poverty levels among rural households, using farm‐level data from Senegal. We use the marginal treatment effect (MTE) approach that not only accounts for selectivity bias from both observed and unobserved attributes but also accounts for heterogeneity in the treatment effects among farming households. The empirical results reveal that farmers with a higher propensity to adopt crop diversification gain more in terms of their food security status and poverty reduction status even under climatic shocks, compared to their lower propensity counterparts. Furthermore, the results from our policy relevant treatment effects (PRTEs) analysis reveal that policies and interventions aimed at engineering connections among farmers to improve information flow are important in the adoption of crop diversification. In particular, social interaction‐oriented policies such as workshops and seminars can increase the adoption of the crop diversification strategy, which would eventually lead to improved household food and nutrition security and reduced poverty levels. The findings also suggest that leveraging crop diversification as a climate risk coping strategy can contribute to poverty alleviation and improved food security of rural farm households.