Effects of Socioeconomic Characteristics on Income and Financial Behavior Amidst the COVID-19 Pandemic in the Democratic Republic of the Congo

Abstract

The Democratic Republic of the Congo as many other countries across the world has been affected by the COVID-19 pandemic. The government of the country declared a state of emergency in March 2020, which restricted travels within and outside the country, schools were closed and many other public activities were suspended. The containment measures taken to limit the spread of this new virus had a negative impact on economic activities. The present study analyzes how different socioeconomic groups were affected financially by the adverse effects of the COVID-19 pandemic in the post conflict eastern region of the DRC. A sample of 312 individuals was selected in three provinces in the eastern part of the Democratic Republic of the Congo. Ordered logit models were applied. Findings reveal that the individuals who were mostly affected financially by the effects of COVID-19 were married, females, youth, public and private sector employees, self-employed individuals and low income earners. Their income has been reduced and they reduced their spending, savings and investments. The present study suggests that social interventions programs are needed and they should prioritize the most vulnerable socioeconomic groups.

Keywords: COVID-19, income, financial behavior, socioeconomic groups, Democratic Republic of Congo

JEL Classification: G50, G40