Resilience in the Face of Negative Shocks: A Household-Level Analysis from Malawi, 2010-2016

This paper investigates the relationship between negative shocks and household resilience using a two-way fixed effects model. While earlier studies have identified access to basic services and natural resources as key resilience factors, a growing consensus emphasizes the need for standardized measures to inform policy. Recent efforts have established connections between resilience and food security outcomes, which are vital proxies for well-being during negative shocks. This analysis employs the RIMA-II framework to construct a Resilience Capacity Index using principal factor analysis, based on four pillars: Access to Basic Services (ABS), Access to Assets (AST), Social Safety Nets (SSN), and Adaptive Capacity (AC). This approach provides insights into the dynamics of resilience and the impact of disaggregated shocks on each pillar over a six-year period. The findings highlight a negative relationship between weather shocks and household dietary diversity but a positive relationship between most shocks and food expenditure per capita. Additionally, the results indicate a positive, albeit counterintuitive, relationship between household resilience capacity and certain shocks. Further examination reveals that access to basic services and social safety nets may play a critical role in strengthening resilience for households impacted by shocks over time.