Flood exposure and vulnerability to poverty: evidence from rural India

Abstract In developing countries, vulnerability to floods is a complex and multidimensional phenomenon shaped by economic, social, demographic, and institutional factors. This study examines the relationship between flood exposure, coping behavior, and vulnerability to poverty in rural Bihar, one of India’s most flood-prone regions. Using primary survey data from 440 households collected across distinct flood-risk regions inside embankments, outside embankments, protected areas, and unprotected areas—we estimate household vulnerability through the vulnerability as expected poverty (VEP) framework. To address the endogeneity of coping behavior, the analysis applies to a treatment-effects model in which coping is instrumented by government relief. The results show that 60.85 percent of surveyed households are vulnerable to poverty, exceeding the observed poverty rate and indicating substantial forward-looking welfare risk. Flood height significantly raises vulnerability, while education, asset ownership, and more favorable social position reduce it. Coping behavior lowers vulnerability on average, but its effectiveness is spatially uneven. It is most effective in protected areas and far less effective in highly exposed locations such as outside embankments and unprotected areas, where recurrent shocks overwhelm household-level responses. These findings suggest that vulnerability is co-produced by environmental exposure and uneven institutional protection. The paper highlights the limits of private coping under chronic flood risk and argues for place-specific public interventions that strengthen resilience before, during, and after disasters.