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Asset functions and livelihood strategies: a framework for pro-poor analysis, policy and practice

The different functions of assets and how they affect livelihood strategies

Authors: A. Dorward; S. Anderson; S. Clark
Publisher: International Livestock Research Institute , 2001

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What are the different functions of assets in livelihood trajectories? How do the functions and attributes of assets affect livelihood strategies? This paper examines the different functions of assets in production, consumption, and exchange in the livelihoods of poor people and presents a framework for analysing the role of assets in livelihoods systems.

The framework is illustrated with preliminary analysis of information on small livestock keeping (pigs and chickens) in Yucatan, Mexico. This data was collected as part of an action research project investigating the potential for improving crop and livestock productivity through greater integration between smallstock keeping and the cultivation of forage crops.

This application of the framework highlights that:

  • The functions of assets, and their effectiveness in fulfilling these functions, are influenced by their attributes, such as holding costs and durability, which in turn depend on the overall asset environment.
  • Where assets have a savings function, easy convertibility may not be the most desirably attribute, even where this means the asset is more expensive.

    The well-being analysis of pig and chickenrearing in Mexico illustrates that:

  • Providing less risky or expensive savings mechanisms can in some circumstances be an alternative to interventions focussed on raising the productivity of assets.
  • In livestock development projects, a focus on better management of feed or better access to alternative feed may be more appropriate than more intensive feeding for raised returns.