Assessing the Effect of Idiosyncratic Shocks on Coping Mechanisms among Agricultural Households in Uganda

Abstract

The study sought to analyze the ex-ante and ex-post coping mechanisms to the idiosyncratic shocks affecting agricultural households. The study employed multinomial logit model for analysis on UNPS 2016 dataset. There were 158 households that suffered from idiosyncratic shocks. Majority reported having suffered from death (55), theft (54) and conflicts (25) while only 15 households reported having suffered from illness. The most popular coping mechanism was relying on saving across all idiosyncratic shocks that affected the household. From the model it was observed that households affected by reduction in earnings were 7.2 times and 8.47 times to cope by relying on savings or other mechanisms respectively other than relying on help from family/friends/ LGs. Households that were affected by theft were more likely to cope by relying on help from family/friends/LG. while households affected by conflict were 9 times likely to cope by relying on savings. This study recommends that the savings culture be boosted especially in the rural areas to support them after effect with idiosyncratic shocks.