The Impact Of Commodity Price Changes On Rural Household Expenditure.
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Date
2023
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Uganda Christian University
Abstract
The global economy's intrinsic volatility has intensified, impacting households and economies alike. This research probes the intricate relationship between commodity price variations, household income, household size, and rural household expenditure. Employing a combination of questionnaires and interviews, this study delves into the financial behaviors of rural households, where socio-economic dynamics often magnify the impact of economic shifts. Examining the background characteristics of respondents unveiled a male-dominant demographic (66.25%), with age-wise majority clustering around 31-35 years. Household expenditure patterns reflected a majority within Ugx 500,000, underlining a range of financial constraints among rural families.
Objective One, investigating the correlation between commodity price changes and expenditure, revealed that while respondents noticed changes, the subsequent impact on mitigation measures was limited. Regression analysis yielded a non-significant association between action-taking and rural household expenditure. The constant term indicated baseline expenditure, irrespective of actions taken, signifying alternative influential factors.
Objective Two explored household income's influence on expenditure. Regression analysis demonstrated a robust positive correlation. An increase in household income correlated with amplified spending. The model's substantial significance (p < 0.001) underscored income's role in shaping spending habits, accounting for around 65% of expenditure variability.
Objective Three aimed to dissect the impact of household size. Contrary to expectation, regression analysis negated a significant association between household size and expenditure. A mere 0.4% expenditure variability was attributed to household size, emphasizing the role of other unexplored factors.
In conclusion, the research offers nuanced insights into rural household financial dynamics. While commodity price fluctuations exhibit limited influence, household income emerges as a dominant determinant of spending behavior. In contrast, household size wields minimal impact. These findings refine the understanding of intricate economic interplays governing rural expenditure, vital for policymakers and practitioners seeking effective interventions in vulnerable communities.
Description
This is a dissertation.