COVID-19 and Microeconomic Resilience in Sub-Saharan Africa: A Study on Ethiopian and Nigerian Households

The severity of the COVID-19 pandemic on overall welfare depends on the resilience of microeconomic units, particularly households, to cope and recover from the shocks created by the pandemic. In Sub-Saharan Africa, where the pandemic has been less pervasive, the pandemic is expected to increase food insecurity, vulnerability, and ultimately poverty. To accurately measure the welfare impact of the pandemic on the macroeconomy, it is important to account for the distributional impact on households and the ability of households to cope with it, which reflects their microeconomic resilience. In this paper, we seek to determine the differential impacts of the COVID-19 pandemic on household microeconomic resilience in Sub-Saharan Africa. We use direct measurements of economic indicators to measure the impact of the pandemic on 6249 households across Ethiopia and Nigeria. Given that resilience is a latent variable, the FAO’s Resilience Index Measure Analysis (RIMA) framework is utilized to construct the resilience index. We hypothesize that the pandemic created differential economic impacts among households and ultimately household microeconomic resilience. Study findings show that government containment measures improved household microeconomic resilience, while self-containment measures lowered microeconomic resilience. Additionally, households that relied on wage employment and non-farm businesses as their main source of livelihood were found to be more microeconomic resilient.