Poor and climate-vulnerable regions hard hit by nationwide lockdowns

New research suggests that poor and climate-vulnerable regions of the world face greater financial and food-security hardships from widespread lockdowns than do more affluent, technology-laden areas.

A recent study from the Sundarbans region in the Indian state of West Bengal provides evidence that nationwide lockdowns can lead to reduced incomes, expenditures, and consumption by poor households who lose access to key markets and income-generating activities as a result of lockdowns.

“The COVID-19 pandemic has disproportionately affected the poor and marginalized all across the globe, even more so in developing countries, many of which imposed lockdowns very strictly at the first wave of COVID,” said Anubhab Gupta, principal investigator on the project and an assistant professor of agricultural and applied economics in the Virginia Tech College of Agriculture and Life Sciences. “We wanted to understand how macrolevel lockdowns can affect micro activities of households, and the Sundarbans region tells a story of lockdown impacts for other poor and climate-vulnerable regions around the world.”

Gupta, along with economists from the University of California at Davis, found that in the month following India’s nationwide lockdown, which began on March 25, 2020, Sundarbans’ households saw an 88 percent drop in local income as well as a 63 percent decline in remittance income.

These two income losses together represent Sundarbans’ primary revenue streams – the first from local market sales and the second from monies sent home by migrant workers who travel away from the region as seasonal casual laborers because coastal cyclones and rising sea levels in the last decade have made income generation through agriculture at home harder.

To understand the impact the lockdown had on Sundarbans and, effectively, the impact future lockdowns might have in other poor and climate-vulnerable regions, the researchers compared COVID lockdown income and expenditures to the pre-COVID baseline they collected from Sundarbans’ households from November 2018 to October 2019. Using fixed-effects regression analysis, they controlled for household characteristics that did not change after the COVID lockdown began.

Weekly financial diaries were used to collect the data from a sampling of Sundarbans households, and the survey instrument also served as an educational tool for school-aged members of the families as they learned about their family’s finances. Results of the study were recently published in the American Journal of Agricultural Economics.

The researchers found that to cope with this loss, 92 percent of households reduced meal portions. The variety of food items consumed fell by 56 percent in the first month following the lockdown, both of which indicate decreased nutrition for members of Sundarbans’ families. At the same time, borrowing in-kind increased while borrowing in cash dropped.

Negative impacts to the region were multifaceted.

“The lockdown stranded migrants in other parts of India, particularly in urban centers,” said Gupta. “Migrants lost their jobs and couldn’t return to their villages since all forms of transportation were stalled. Those remaining in the Sundarbans also couldn’t work because there was a disruption in the supply chain – there were reduced markets to sell products.”

With India’s lockdown going into effect just four hours after it was announced, many migrant workers also suffered physical harm trying to make the journey home on foot as transportation lines ceased to operate. In other cases, Sundarbans families had to send money to members of their household who were stranded elsewhere. These monies were in effect reverse remittances.

“Lockdowns are important to stop the spread of the virus, but it’s tricky when you think of a country where the majority of the population cannot work remotely because of technological shortcomings and their lives depend on certain daily activities,” Gupta said.

Gupta added: “Governments should carefully think about implementing lockdowns. In the case of India, this full-on lockdown was not planned and it resulted in stranded migrants, chaos, and massive market disruptions, which shows that it’s important for governments to understand the impacts of these lockdowns. We hope that this research can inform them on how to cope with future lockdowns if they were to impose them.”

To avoid large-scale negative impacts like those experienced by Sundarbans households, Gupta and his team recommend that governments ensure that farmers and poor households continue to have access to markets. He also recommends government financial interventions including the expansion of existing social safety nets.

Although many negative effects of the lockdown on Sundarbans households were quantified, the researchers acknowledge that longer-run impacts also likely exist.

“These are short-term impacts of the lockdown,” Gupta said. “But there would be longer-run impacts – for example, households might sell off their assets to deal with the short-run issues, which could have longer-term consequences for their future well-being.”

Gupta and his team encourage further research to understand some of the long-term negative impacts of the COVID-19 lockdowns, particularly on poor households in developing countries.

“Lockdown impacts on poor households have been significant,” Gupta said. “Many households that were on the borderline of poverty have been pushed back into poverty. And many developing countries won’t get the vaccines as quickly, so they have to bear the burden of the pandemic for longer until the vaccine becomes available to them.”

— Written by Jillian Broadwell