Subjective well-being, disability and adaptation: A case study from rural Ethiopia

In many developing countries poor infrastructure – including sanitation and health facilities – exposes the population to high risks of disability. Low standards of health and safety at work and at home, coupled with political, ethnic, and domestic violence, also contribute to raising the risk of becoming physically disabled. The effect of physical disability on people's lives is likely to be worse than in developed economies because of the reliance on physical labour for income generation – for example, in farming. Higher levels of national income and technological capability may also enable societies to make the investments required to enable disabled individuals to be productively employed. Finally, since formal social insurance is usually lacking in developing countries, the effect of disability on welfare is expected to be higher as disabled people must rely on social networks that have limited capacity to pool risks (Fafchamps and Lund, 2003). However there are also factors that tend to lower the proportion of disabled individuals in poor societies. The first one is lower life expectancy. In developed economies, the incidence of disability typically increases with age (e.g., loss of eyesight and hearing, paralysis due to stroke). This means that, other things being equal, populations with a larger proportion of elderly people have a larger proportion of disabled individuals. Put differently, many people in poor rural economies do not live long enough to become disabled. The second reason is that disability may have such dire consequences in terms of lost income and lack of support that disabled individuals have a much shorter life expectancy than they would have in a developed economy. If this is the case, the proportion of disabled individuals in the population may be low even though the risk of disability is high. In spite of the fact that disability is an important welfare concern, socioeconomic studies on the effect of disability in developing countries are few in number. This chapter seeks to fill this gap by documenting the incidence of different forms of disabilities in rural Ethiopia. Using cross-sectional data from the Ethiopian Rural Household Survey collected in 2004, we examine the relationship between disability and welfare as captured by subjective well-being and self-reported wealth ranking questions. In particular, we test whether the negative effect of disability on welfare decreases over time. If it does, this would suggest that over time people adapt to disability. We also investigate whether the negative …