Household coping and response to government stimulus in an economic crisis : evidence from Thailand
The crash of global financial markets in 2008 caused a ripple effect on economic demand and growth worldwide. Export-oriented economies were hit particularly hard, and many governments stepped in quickly with broad-ranging stimulus programs to lessen the effects on households of rising unemployment and falling income. To better understand the role that stimulus policy might play in softening the effects of these shocks, this paper examines recent nationally-representative data from Thailand, an export-dependent economy where a large-scale stimulus program was introduced in 2009. Using monthly data spanning 2006-2010, the paper uses sub-province-level community panel data to examine the effects of major components of the stimulus on household consumption, income, borrowing, and debt repaid. To address simultaneity of changes in government spending and household outcomes, the analysis estimates a dynamic panel regression, instrumenting the stimulus effect with second-order lagged outcome variables, and estimating the model using the Generalized Method of Moments. The results suggest that household participation in these programs helped smooth consumption. This increase in monthly consumption was not supported from household receipts from the government stimulus, but more likely through a reallocation of consumption and savings that included greater debt repayment. The paper typically finds stronger effects in urban compared with rural areas.
|Date of creation:||01 Mar 2012|
|Contact details of provider:|| Postal: 1818 H Street, N.W., Washington, DC 20433|
Phone: (202) 477-1234
Web page: http://www.worldbank.org/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Khandker, Shahidur R., 2012. "Seasonality of income and poverty in Bangladesh," Journal of Development Economics, Elsevier, vol. 97(2), pages 244-256.
- Jed Friedman & James Levinsohn, 2002.
"The Distributional Impacts of Indonesia's Financial Crisis on Household Welfare: A "Rapid Response" Methodology,"
World Bank Economic Review,
World Bank Group, vol. 16(3), pages 397-423, December.
- Jed Friedman & James Levinsohn, 2001. "The Distributional Impacts of Indonesia's Financial Crisis on Household Welfare: A "Rapid Response" Methodology," NBER Working Papers 8564, National Bureau of Economic Research, Inc.
- Jed Friedman & James Levinsohn, 2001. "The Distributional Impacts of Indonesia's Financial Crisis on Household Welfare: A 'Rapid Response' Methodology," Working Papers 482, Research Seminar in International Economics, University of Michigan.
- Jed Friedman & James Levinsohn, 2001. "The Distributional Impacts of Indonesia's Financial Crisis on Household Welfare: "A Rapid Response Methodology"," William Davidson Institute Working Papers Series 387, William Davidson Institute at the University of Michigan.
- Francisco H. G. Ferreira & Anna Fruttero & Phillippe G. Leite & Leonardo R. Lucchetti, 2013. "Rising Food Prices and Household Welfare: Evidence from Brazil in 2008," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(1), pages 151-176, 02.
- Ferreira, Francisco H. G. & Fruttero, Anna & Leite, Phillippe & Lucchetti, Leonardo, 2011. "Rising Food Prices and Household Welfare: Evidence from Brazil in 2008," IZA Discussion Papers 5713, Institute for the Study of Labor (IZA).
- Francisco H. G. Ferreira & Anna Fruttero & Phillippe Leite & Leonardo Lucchetti, 2011. "Rising food prices and household welfare: Evidence from Brazil in 2008," Working Papers 200, ECINEQ, Society for the Study of Economic Inequality.
- Ferreira, Francisco H. G. & Fruttero, Anna & Leite, Phillippe & Lucchetti, Leonardo, 2011. "Rising food prices and household welfare : evidence from Brazil in 2008," Policy Research Working Paper Series 5652, The World Bank.
- Alderman, Harold, 1996. "Saving and economic shocks in rural Pakistan," Journal of Development Economics, Elsevier, vol. 51(2), pages 343-365, December.
- Ennis, Huberto M. & Keister, Todd, 2010. "Banking panics and policy responses," Journal of Monetary Economics, Elsevier, vol. 57(4), pages 404-419, May.
- Fabrizio Bresciani & Gershon Feder & Daniel O. Gilligan & Hanan G. Jacoby & Tongroj Onchan & Jaime Quizon, 2002. "Weathering the Storm: The Impact of the East Asian Crisis on Farm Households in Indonesia and Thailand," World Bank Research Observer, World Bank Group, vol. 17(1), pages 1-20. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:6016. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.