ASSESSMENT OF IDIOSYNCRATIC INCOME SHOCKS AND FOOD INSECURITY DURING THE COVID-19PANDEMIC IN MOZAMBIQUE: AN ENDOGENOUS ORDERED PROBIT MODEL

Abstract

COVID-19 was a pandemic that exposed households worldwide to various idiosyncratic shocks, significantly affecting the Mozambican economy through widespread job and income losses, with far-reaching impacts on economic growth. This paper contributes to the existing body of knowledge by examining the effects of idiosyncratic income shocks on food insecurity during the COVID-19 pandemic in Mozambique. Data for the study were collected by the Food and Agriculture Organization (FAO) from a total of 3,975 households across two non-longitudinal waves. Descriptive statistics and an endogenous ordered probit regression were used for the analysis. The results showed that 51.92% of respondents experienced at least one type of idiosyncratic shock, while 33.83% of households did not engage in any form of farming. The probability of exposure to income shocks was significantly lower (p < 0.05) in the provinces of Inhambane, Manica, Maputo and Niassa, while household incomes were significantly reduced (p < 0.05) in Gaza, Inhambane, Maputo, Sofala and Zambezia. Food insecurity was significantly reduced only in Gaza, Inhambane, Tete and Zambezia provinces. Exposure to income shock significantly increased food insecurity, whereas higher household incomes reduced it. Notably, access to social assistance was found to have no significant impact on food insecurity, while engagement in crop and livestock farming reduced food insecurity but heightened exposure to idiosyncratic shocks. It is recommended that future initiatives prioritise enhancing household incomes through job creation and human capital development. Additionally, mitigating income shocks requires a focus on revamping existing social assistance programmes, with a nuanced understanding of the distinct vulnerabilities across provinces.