This paper utilizes the third wave of the Nepal LivingStandards Survey to assess the causal impact of parental absence and remittances on the educational investment in children left behind. Unlike previous studies, we separately identify parental absence and remittances, with careful consideration of self-selection into migration and endogeneity of remittances. Using a two-step estimation strategy, we show that parental absence has a substantive disruptive effect on education of children left behind, while remittances have a positive effect. In addition, we show that non-parental absence has no effect on education. Further, we provide supporting evidence about the channels to disruption. Finally, we show some heterogeneity results by the child's gender and education status of the mother. The results by child's gender confirm that remittances relax the liquidity constraints of households by investing in education of the girls. Further, the results by education status of the mother provide evidence that an educated mother can play a role in neutralizing or mitigating the negative effects of parental absence. wileyonlinelibrary.com/journal/rode Rev Dev Econ. 2018;22:1642-1666. RAUT AND TANAKA | 1643

This paper assesses the interrelationship between poverty, climatic and non-climatic shocks, and shock coping strategies adopted by farm-based rural households in Nepal. An analysis is based on a comprehensive data set collected from 300 randomly selected households from three purposively chosen villages of Gandaki province. The study utilizes binary and ordered probit regression models to analyze the determinants of poverty, shocks, and coping strategies. Findings reveal that the Dalit (ethnic group), large-sized, and agricultural households are more likely to be characterized as poor. The study further shows that majority of the households are exposed to the severe shock of climatic types. Patterns of shock exposure vary with the household’s characteristics. In particular, poor households in the hills primarily dependent on forest for livelihood are more likely to experience severe shocks. Further analyses indicate that the households ex-post choose dissaving, borrowing, shifting occupation, and migration to cope with severe climatic shocks. The analyses also reveal that the nature of shocks, socio-economic, demographic, geographic contexts, and factor endowments effect adopting a particular coping strategy. Findings suggest household level-specific support should be provided to mitigate the effects of shock, and appropriate measures are taken to protect their means of living.

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