Consumption Smoothing and Vulnerability in Russia

39 Pages Posted: 24 Jan 2008

See all articles by Christopher J. Gerry

Christopher J. Gerry

University of Oxford, OSGA and St Antony's College; HSE St. Petersburg, International Centre for Health Economics, Management and Policy

Carmen A. Li

University of Essex - Department of Economics

Date Written: July 2007

Abstract

Applying bootstrapped quantile regression to the Russian Longitudinal Monitoring Survey (RLMS) data, we examine the channels through which individuals experience and seek to cope with changes in consumption. We find that married individuals living in small households, with educated heads in urban areas are better equipped to smooth consumption. Investigating the impact of idiosyncratic shocks, we find that the labour market is an important transmission mechanism allowing households to smooth their consumption but also exposing them to risk, mainly through job loss. Outside of pension payments the formal social safety net does not facilitate consumption smoothing, thus heightening the importance of informal coping institutions. It transpires that both support from relatives/friends and home production act as important insurance mechanisms for the most vulnerable.

Keywords: Russia, economics, vulnerability, consumption smoothing, quantile

JEL Classification: I31, P20

Suggested Citation

Gerry, Christopher J. and Li, Carmen A., Consumption Smoothing and Vulnerability in Russia (July 2007). William Davidson Institute Working Paper No. 885, Available at SSRN: https://ssrn.com/abstract=1086161 or http://dx.doi.org/10.2139/ssrn.1086161

Christopher J. Gerry (Contact Author)

University of Oxford, OSGA and St Antony's College ( email )

11
Bevington Road
Oxford, Oxfordshire OX26LH
United Kingdom

HSE St. Petersburg, International Centre for Health Economics, Management and Policy ( email )

Souza Pechatnikov street, 16
St. Petersburg, St. Petersburg 190008
Russia

Carmen A. Li

University of Essex - Department of Economics ( email )

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom
+44 1206 872723 (Phone)
+44 1206 872724 (Fax)

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