Using Weekly Financial and Health Diaries to Track Health and Income Effects of the COVID-19 Outbreak and Government Response Measures in Rural Kenya

Press/Media: Expert Comment

Description

This research assesses how low-income households in rural Kenya coped with the immediate economic consequences of the COVID-19 pandemic. It uses granular financial data from weekly household interviews covering six weeks before the first case was detected in Kenya to five weeks after during which various containment measures were implemented. Based on household-level fixed-effects regressions, our results suggest that income from work decreased with almost one-third and income from gifts and remittances reduced by more than one-third after the start of the pandemic. Nevertheless, household expenditures on food remained at pre-COVID levels. We do not find evidence that households coped with reduced income through increased borrowing, selling assets or withdrawing savings. Instead, they gave out less gifts and remittances themselves, lent less money to others and postponed loan repayments. Moreover, they significantly reduced expenditures on schooling and transportation, in line with the school closures and travel restrictions. Thus, despite their affected livelihoods, households managed to keep food expenditures at par, but this came at the cost of reduced informal risk-sharing and social support between households.

Period11 Mar 2021

Media coverage

1

Media coverage

  • TitleUsing Weekly Financial and Health Diaries to Track Health and Income Effects of the COVID-19 Outbreak and Government Response Measures in Rural Kenya
    Media name/outletRECOVR Roundup Newsletter (IPA - Innovations for Poverty Action)
    Media typeWeb
    Date11/03/21
    DescriptionThis research assesses how low-income households in rural Kenya coped with the immediate economic consequences of the COVID-19 pandemic. It uses granular financial data from weekly household interviews covering six weeks before the first case was detected in Kenya to five weeks after during which various containment measures were implemented. Based on household-level fixed-effects regressions, our results suggest that income from work decreased with almost one-third and income from gifts and remittances reduced by more than one-third after the start of the pandemic. Nevertheless, household expenditures on food remained at pre-COVID levels. We do not find evidence that households coped with reduced income through increased borrowing, selling assets or withdrawing savings. Instead, they gave out less gifts and remittances themselves, lent less money to others and postponed loan repayments. Moreover, they significantly reduced expenditures on schooling and transportation, in line with the school closures and travel restrictions. Thus, despite their affected livelihoods, households managed to keep food expenditures at par, but this came at the cost of reduced informal risk-sharing and social support between households.
    URLhttps://www.poverty-action.org/recovr-study/using-weekly-financial-and-health-diaries-track-health-and-income-effects-covid-19?utm_source=newsletter3&utm_medium=email&utm_campaign=recovr-roundup-11#
    PersonsAmanuel Abajobir, Hermann Donfouet, Estelle Sidze, Richard de Groot, Menno Pradhan, Wendy Janssens