THE IMPACT OF NATURAL DISASTER ON LIVELIHOOD DIVERSIFICATION STRATEGIES OF RURAL HOUSEHOLDS IN CHINA
Natural disasters are critical factors that affect the stability of rural households' livelihoods. This study adopted a two-way fixed-effects model to empirically investigate the impact of natural disasters on the diversification of rural households' livelihoods based on the four rounds of survey data from 2012 to 2021 in the western provinces of China. The research findings were indicated as follows. (1) Natural disasters led to a significant decrease in the Herfindahl-Hirschman Index (HHI) of livelihood diversification among affected households. The occurrence of disasters prompted households to adopt livelihood diversification strategies to cope with uncertainty,particularly for heavily indebted households facing financial constraints. (2) As insurance costs increased,the impact of natural disasters on livelihood diversification diminished. This suggested that enhancing insurance coverage helped reduce households' inclination toward livelihood diversification,thereby promoting specialization and improving production efficiency. (3) Non-farm production and operation constituted the primary form of livelihood diversification for rural households. Therefore,he government should expand income channels for rural households,optimize the insurance market,and improve technical training to enable autonomous choices among different production sectors,employment forms,and business strategies. It is crucial to break down institutional barriers that hinder the mobility of rural households as labor factors across different sectors,thus facilitating the rational allocation of rural labor resources.