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Household Responses to Economic and Demographic Shocks: Marginal Logit Analysis using Indonesian Data

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  • Francesca Modena
  • Christopher L. Gilbert

Abstract

We analyse the responses of Indonesian households to demographic and economic shocks and examine how these responses vary in relation to the household's permanent income and the extent to which the shock is common across the community. Households respond in different ways to demographic and economic shocks. Economic shocks are more likely to result in a labour supply response from the household and this probability is further increased if the shock is common. For rural households, use of savings increases with permanent income. The article also examines the role of the interviewer in influencing survey responses.

Suggested Citation

  • Francesca Modena & Christopher L. Gilbert, 2012. "Household Responses to Economic and Demographic Shocks: Marginal Logit Analysis using Indonesian Data," Journal of Development Studies, Taylor & Francis Journals, vol. 48(9), pages 1306-1322, September.
    • Handle: RePEc:taf:jdevst:v:48:y:2012:i:9:p:1306-1322
    DOI: 10.1080/00220388.2012.685723
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    References listed on IDEAS

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    1. Christopher L. Gilbert & Francesca Modena, 2007. "Models for Non-Exclusive Multinomial Choice, with Application to Indonesian Rural Households," Department of Economics Working Papers 0724, Department of Economics, University of Trento, Italia.
    2. Berloffa, Gabriella & Modena, Francesca, 2013. "Income shocks, coping strategies, and consumption smoothing: An application to Indonesian data," Journal of Asian Economics, Elsevier, vol. 24(C), pages 158-171.
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    Cited by:

    1. Thomas Gries & Ha van Dung, 2014. "Household Savings and Productive Capital Formation in Rural Vietnam: Insurance vs. Social Network," Working Papers CIE 81, Paderborn University, CIE Center for International Economics.
    2. Azomahou T.T. & Yitbarek E., 2015. "Poverty persistence and informal risk management: Micro evidence from urban Ethiopia," MERIT Working Papers 2015-006, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    3. Mulungu, Kelvin & Kilimani, Nicholas, 2023. "Does forest access reduce reliance on costly shock-coping strategies? Evidence from Malawi," Ecological Economics, Elsevier, vol. 209(C).

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