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<p>This study investigates diversification as a livelihood strategy to buffer shocks among female-headed households in rural Rwanda. We investigate the impact of livelihood diversification on per capita consumption and predict the shocks’ coping mechanism using a two-stage least squares with ordered logit (2SLS-OL) approach. Households that are highly diversified consume more, and are more resilient to shocks — highlighting the heterogeneous effects of diversification. The analysis uses data from the Fifth Integrated Household Living Conditions Survey (EICV 5) on 1,277 female-headed households that have encountered shocks. While diversification tends to negatively affect female-headed households in general, such as lowering per capita consumption, the most diversified households tend to fare better. These households act as shock absorbers to economic and environmental shocks, consuming at higher levels and with greater economic stability than their less-diversified peers. Our results suggest a need for outreach to support targeting of livelihood diversification, especially among households with high potential for diversification success. Such interventions should involve provision of resources, capacity enhancement activities, and training programs tailored to expand the skills of women to participate in a variety of income-generating activities with high product value. Furthermore, programs focused on asset accumulation, including livestock ownership, are key to building resilience and economic security.</p>

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Coping mechanisms: how female-headed households manage shocks through diversified livelihoods

  • 期刊论文

  • 发表日期：

    2025年6月4日

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  • Fabrice Nkurunziza,
  • Richard Kabanda,
  • Patrick McSharry

摘要

This study investigates diversification as a livelihood strategy to buffer shocks among female-headed households in rural Rwanda. We investigate the impact of livelihood diversification on per capita consumption and predict the shocks’ coping mechanism using a two-stage least squares with ordered logit (2SLS-OL) approach. Households that are highly diversified consume more, and are more resilient to shocks — highlighting the heterogeneous effects of diversification. The analysis uses data from the Fifth Integrated Household Living Conditions Survey (EICV 5) on 1,277 female-headed households that have encountered shocks. While diversification tends to negatively affect female-headed households in general, such as lowering per capita consumption, the most diversified households tend to fare better. These households act as shock absorbers to economic and environmental shocks, consuming at higher levels and with greater economic stability than their less-diversified peers. Our results suggest a need for outreach to support targeting of livelihood diversification, especially among households with high potential for diversification success. Such interventions should involve provision of resources, capacity enhancement activities, and training programs tailored to expand the skills of women to participate in a variety of income-generating activities with high product value. Furthermore, programs focused on asset accumulation, including livestock ownership, are key to building resilience and economic security.