Pandemics erode poverty alleviation process: Impact on productive livelihood and poverty return

Abstract

Pandemics such as COVID-19 threaten income growth by disrupting productive activities for households, especially those that have just escaped from poverty. We provide empirical evidence on how the pandemic disproportionately threatens the rural productive livelihood based on 48 months of household production electricity consumption data. The results indicate that after COVID-19, the productive livelihood activities of 51.11% households that have just overcome poverty have returned to the level before poverty alleviation. Their productive livelihood activities dropped by 21.81% on average during the national COVID-19 epidemic and by 40.57% during the regional epidemic. The households with lower income, lower level of education, and less labor force suffer more. We estimate a 3.74% decline in income owing to the decrease in productive activities, resulting in 5.41% of households potentially falling back into poverty. This study provides an important reference for countries being at risk of returning to poverty after the pandemic.