Poverty Raises Levels of the Stress Hormone Cortisol: Evidence from Weather Shocks in Kenya*

Does poverty lead to stress? Despite numerous studies showing correlations between socioeconomic status and levels of the stress hormone cortisol, it remains unknown whether this relationship is causal. We used random weather shocks in Kenya to address this question. Our identi cation strategy exploits the fact that rainfall is an important input for farmers, but not for non-farmers such as urban artisans. We obtained salivary cortisol samples from poor rural farmers in Kianyaga district, Kenya, and informal metal workers in Nairobi, Kenya, together with GPS coordinates for household location and high-resolution infrared satellite imagery meausring rainfall. Since rainfall is a main input into agricultural production in the region, the absence of rain constitutes a random negative income shock for farmers, but not for non-farmers. We nd that low levels of rain increase cortisol levels with a temporal lag of 10-20 days; crucially, this e ect is larger in farmers than in non-farmers. Both rain and cortisol levels are correlated with self-reported worries about life. Together, these ndings suggest that negative events lead to increases in worries and the stress hormone cortisol in poor people. JEL Codes: C93, D03, D87, O12