Joseph Cotterill: Cows as safe assets:
[Anagol, Etang, and Karlan note that] maybe cows aren’t at all safe assets in developing economies…. They become sick, or wander off, or (increasingly even in India) get rustled. Yet rural households appear ready to pay up to keep cattle even so…. If labour markets for women don’t exist, and they cannot have labour value, then there’s no opportunity cost in their tending cattle at home instead. Maybe. The other theory’s more to do with financial liberalisation itself. Poor households already tolerate negative interest rates on savings sometimes, given their only avenues are often informal and costly vehicle, according to the paper. Compared to the local deposit collector, cattle might be a safer asset.