# Understanding the ability of households to cope with economic shocks: an empirical study of Pakistan during the COVID-19 pandemic

## TL;DR

This study explores how households in Pakistan coped with economic challenges during the COVID-19 pandemic, focusing on food security and financial strategies.

## Contribution

The study provides new insights into household resilience and coping mechanisms in low- and middle-income settings during global crises.

## Key findings

- Substituting low-quality food sources was the most common coping mechanism affecting food security.
- Most coping strategies did not significantly reduce the likelihood of severe pandemic effects, except for bank loans.
- The study highlights the complexity of responding to multifaceted crises like the pandemic.

## Abstract

The COVID-19 pandemic presented unprecedented challenges to households throughout the world, particularly in low- and middle-income countries. Pakistan’s COVID-19 management policies have been widely recognized for their effectiveness at both national and international levels.

In this study, we empirically examine households’ response to external shocks, such as the COVID-19 pandemic, and the coping mechanisms adopted at the household level in Pakistan.

Based on Rational Choice Theory, the research examines 3456 households, encompassing both urban and rural areas, using official survey data from the National Bureau of Statistics of Pakistan. The study utilizes the logit model for the estimations.

The findings show that substitution for low-quality food sources is the most common coping mechanism and closely impacts food security. Interestingly, the study revealed that, except for bank loans, none of the coping mechanisms significantly reduced the likelihood that families would experience severe COVID-19 effects.

The findings of the study underscore the complexities of responding to a multifaceted crisis such as the pandemic. This research contributes essential insights into the evolving discourse on pandemic resilience, recovery strategies, and anticipated similar shocks.