Income Shocks and Resilience of Economic Institutions

Abstract

In the backdrop of COVID-19 pandemic, the coping strategies of individual household members and support provided by collective organizations including NGOs have been analysed. In-depth semi-structured interviews of individuals and organizations across different regions of India have been conducted in 2020 and 2021. The interviews reveal that employment and income losses have taken place both in formal and informal sector. Market and Government institutions have failed to smooth out the income and consumption stream. People who work or would be able to work as agricultural labourers or are self-employed, who mostly constitute the informal labour force, have lost employment and earned lesser income or are more expected to get gainful employment later than people who work under factory mode of production. The study shows that NGOs have intervened for smoothing of income and consumption of households. The role of NGOs is very important in promoting employment other than those based on factory model of production. The study suggests informal transactions and collective organizations should be brought into the fold of mainstream economic policy for developing more resilient economic institutions.