• How Ex-Post Coping Strategies Aggravate Poverty Traps in Uganda: Evidence from Panel Data

    Author(s):

    Alex Aliga


    address:aligaalex76@gmail.com
    2026-03-07 16:15:35

    3 Downloads 6 Views

    Abstract

    The use of multiple ex-post poverty coping strategies can potentially aggravate the state of poverty trap among households. However, there is paucity of empirical ev idence about how such coping strategies perpetuate poverty traps in Uganda’s case. This study examines and tests the effect of ex-post coping strategies on Uganda’s households living in poverty trap using panel data. A two stage dynamic S-GMM model is applied to a short micro panel data while a random effects model is applied to the non-dynamic model upon conducting panel data diagnostic tests. The key mul tiple ex-post coping strategies households used to cope with shocks include: depleting savings, selling durable assets, receiving unconditional help from a relative, changing dietary patterns involuntarily, doing nothing, taking on more non-farm activities and borrowing. Depleting savings is mainly used by female headed households and house hold heads with no formal education, which is a recipe for destitution. ‘Doing nothing’ adopted by male heads of households reveal a state of helplessness while borrowing is unsustainable. A joint hypothesis test reveals that both ex-post consumption smooth ing and assets coping strategies aggravate poverty trap among households. Previous period poverty trap accounts for 5.5% of current period poverty trap and is associated with a 26.5% reduction in consumption. Household size, age, education, being a rural dweller and region are critical socio-demographic and location factors in explaining coping strategies’ poverty trap aggravating effects. Implementation of well-structured and targeted interventions are critical in addressing this situation.

    Keywords
    Poverty-trap, ex-post coping strategies, household, Uganda.

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