Financial capability and emergency savings among South Africans living above and below the poverty line

Emergency savings provide a buffer against financial shocks, particularly among low‐income households. Despite the importance of these funds in lessening financial hardship, many households have not set aside emergency funds. It has been suggested that financial capability may play a role in financial behaviour. Therefore, this study considers whether financial capability is associated with saving for emergencies and whether there are differences in factors that predict emergency savings behaviour among those living below and above the poverty line. Using data from a sample of South Africans, logistic regression is used to determine the predictors of emergency savings. The study finds that those with higher levels of financial capability, related to financial self‐efficacy and having access to a bank account, are more likely to have emergency savings compared with those with lower levels of financial capability. However, no evidence is found to suggest a relationship between objectively measured financial knowledge and emergency savings. Therefore, the findings suggest that self‐assessed financial ability, as measured by financial self‐efficacy, might be more important than objectively assessed ability in the context of individuals making responsible financial choices. Differences in the predictors of emergency savings for those living above and below the poverty line related to socioeconomic and demographic differences, whereas the same financial capability predictors were significant predictors in both samples. The study provides unique insights into the predictors of emergency savings in a developing market context and identifies the characteristics of those who are likely to be financially resilient to unexpected economic shocks. The importance of the broader financial capability construct in predicting emergency savings, for both those living above and below the poverty line, suggests that programmes aimed at encouraging emergency savings should focus on enhancing financial self‐efficacy and financial inclusion.     

Social stratification and mobility among Chinese middle class households: An empirical investigation

Middle class (MC) consumers’ demand for a better quality of life continues to drive economic growth in emerging markets (EMs). Given their importance for the dynamically transforming economy in EMs, the present study examines the extent to which consumption patterns are associated with social stratification and mobility among China's MC consumers. Building on the extant literature that links material and culture consumption to social stratification, we construct a typology of MC households in contemporary China, identifying the factors by which these newly emerging MC households vary or are similar in their consumption behavior. We find that, of the three widely recognized stratifying dimensions (income, education, and occupation), educational attainment is the strongest indicator explaining the variance in culture consumption among the MC households, while occupation plays a relatively weak role in explaining their consumption patterns. Among the alternative pathways into the social class position of MC, our findings suggest that merely becoming wealthy is negatively related to culture consumption of these new MC households while becoming MC defined by educational attainment or belonging to the core middle class (whose status is achieved on all of the three stratifying dimensions) has a profound effect on both material and culture consumption. The findings support the conclusion that social stratification and mobility are of importance for China's MC consumers in shaping and maintaining their lifestyles and consumption patterns.     

Rising prices and coping strategies of urban families in India

This study examines how Indian urban households coped with rising prices over the period 1995–1996 to 1999–2000. It provides evidence of cost of living indices and the coping strategies of urban households belonging to different income groups. Although there has been a lively debate on inflation and related issues, most of the studies were macro studies, which have not paid explicit attention to the impact of rising prices on the coping and financial management responses of the affected families. This paper is a part of a larger cross‐sectional study on the impact of rising prices on quality of life and financial management practices of Indian urban households belonging to five different income groups. This paper provides the evidence on cost of living indices and the coping strategies adopted by these households to combat an otherwise hostile economic environment. It found that the impact of cost of living indices differs across different income groups depending upon the composition of the consumption basket and the proportion of expenditure incurred on specific items of that basket. It is also observed that rational responses of households played an important role in coping with increased cost of living. The evidence suggests that a wide range of coping strategies is adopted by households such as consumption reallocation and seeking increased earning opportunities as part of their backward and forward coping strategies.     

Spatial behaviour of rural consumer households in highly developed economies. Survey results for Western Germany

This contribution attempts to identify effects of residential location of rural family households on their economic behaviour. Economic behaviour is understood to be reflected in the total spectrum of income and allocation of household resources. A holistic approach must go beyond activity on the labour and consumer markets and include non-market (‘informal’) activities of household members, taking into account domestic production of goods and services, interaction within social networks, the use of public commercial infrastructure, etc. The cost of living depends, among other things, on patterns of consumption, on regional price levels for consumer breadbaskets, as well as on costs involved in reaching public and commercial points of distribution. These factors result themselves from the interplay of economic forces giving rise to identifiable ‘economic territories’ and ‘market areas’ and ultimately to observable consumptive behaviour and ‘activity spaces’ of individual private households. Since data was available only for our rural survey households, comparative analysis of locational aspects was limited to consumption expenditures for which data could be found in administrative statistics for households in urban and periurban areas. The rural survey sample was found to have a higher average level and a different structure of expenditures when compared with their non-rural counterparts. At the same time, a preliminary effort was made in our own rural survey sample to determine the importance of non-market consumption for rural households. This included household consumption of domestic self-services (‘housework’), the utility value of owner-occupied dwellings, do-it-yourself production of substitutes for commercial goods and services, and exchanges within social networks. Results of this initial investigation of non-market elements of the household economy indicated that they were very important for the household's level-of-living and that they had a potential for compensating inequalities due to different degrees of access to market resources. Household strategies for optimizing their resource allocation to both market and non-market consumption were also examined. In general, ‘objective’ criteria and ‘subjective’ assessments by the survey households with respect to living conditions in rural Western Germany were found to give a positive image of rural life; however, differences in resource allocation strategies for market consumption between urban and rural households having been confirmed above, the question remains for future research about possible locational differences in household acquisition and use of non-market resources.     

Changes in food provision in Russian households experiencing perestroika

The purpose of this article is to describe how households in Novgorod the Great, Russia, deal with food provision in everyday life. The study focuses on changes experienced in food provision and consumption in Russian society, in order to illustrate how households respond to the transformation towards a market economy. The study reflects women's perspective on food provision. Students from Novgorod the Great visited 105 households and asked the women in the household to answer a questionnaire. Results from the study show that in order to cope with changes in society related to economic reforms, Russian households had changed both their food consumption and food production patterns. There was no big difference between urban and rural households. Nearly all of the households were self‐sufficient in the provision of vegetables and potatoes. Many households had a ‘dacha’ (plot), where they produced most of what they needed. Among the changes experienced during recent years (i.e. during the end of the 1990s), a decade after perestroika was initiated, households mentioned the rise in food prices and the decrease of income. Households reported that they consumed less fruit and/or meat. Some households also mentioned that the quality of nourishment had decreased, thereby indicating lower general quality, lower nutrition value, or less healthy foodstuffs.     

Are Two Incomes Needed to Prosper Today? Evidence from the 1960s to the 1990s

Consumer Expenditure Survey data from 1960 to 1996 are used to examine trends in real consumption, real after‐tax income, market work time, and real after‐tax wages for single‐earner and dual‐earner households. Over the entire time period, most households experienced substantial improvements in measures of their prosperity. However, economic progress was considerably reduced when the comparison was from 1972 to 1996. Also, wage changes dominated changes in market work time over all time periods.     

The role of economic and normative signals in international prosocial crowdfunding: An illustration using market orientation and psychological capital

Entrepreneurs in emerging nations are increasingly seeking microloans on international crowdfunding platforms composed of prosocial lenders primarily seeking non-monetary returns. Drawing on signaling theory, we posit that economic signals (as illustrated by market orientation) and normative signals (as illustrated by psychological capital) embedded within borrower narratives will influence funding time. A Computer-Assisted-Text-Analysis (CATA) of 130,964 profiles across 49 countries suggests that borrower cues of customer orientation, competitor orientation, long-term focus, profitability focus, confidence, and optimism are positively associated funding time, while cues of coordination, hope, and resilience are negatively associated with funding time. Prosocial lenders seem less inclined to lend to borrowers that exhibit a desire for economic success or normative expectations for positive outcomes in the future, while they seem to lend more rapidly to those exhibiting current hardship or a concern for people. A discussion of these findings and their implications for poverty alleviation concludes the study.     

Expenditure patterns on food and non food items of Khayelitsha households,Western Cape,South Africa

Food insecurity or lack of access to adequate and nutritious food is a major determinant of under‐nutrition. Expenditure patterns accompanied by unemployment, low level of education, inflation and high food prices have a direct negative impact on food availability within households (Moller, 1997). Ghany and Schwenk (1993) found that as household income increases, the proportion of expenditures on food decreases, the proportion of expenditures on clothing, rent, fuel, and light stayed the same and that of sundries increased. The aim of this study was to investigate household expenditure patterns on food and non‐food items in Khayelitsha. A total of 20 households (10 from the formal and 10 from the informal settlements) were randomly selected from those willing to participate in the study. A questionnaire with open ended and closed questions was used to collect data. The questionnaire comprised four sections namely: biographical information, socio‐economic information which used wealth quintiles to assess households’ social economic status, total expenditure information and a food/hunger scale was used to assess households’ food availability. The findings revealed that households from informal settlements spent more money (62.2%) as a proportion of their income on food compared to households from the formal settlement (39%). There was higher unemployment rate (100%) at the informal settlement compared to the formal settlement (40%). Wealth quintiles scales did not reflect the social status of the households as equipment and assets owned by households were only used as fallback position during times of economic hardships. Households used different purchasing strategies; food and non‐food items were mainly purchased from outside the township (60%). Forty percent of the households bought their items from local shops and spazas because they allowed them to buy items whenever little money was available or to take items on credit. All the respondents preferred to buy bread and small items from spazas and local shops. Prices of items in the spazas and local shops were higher compared to prices of items in bigger shops outside the townships. The food/hunger scale and wealth quintiles showed that informal settlement households were more food insecure (as they were all unemployed and about 50% of the households ran out of food always) and had fewer assets compared to the formal settlement households. The implications of these findings underscore the need to improve socio‐economic conditions of low resource households through empowerment programs. These programs can be in the form of training in management/decision making, work related skills/literacy (to help them access formal employment), business management/income generation skills (to help them to be self‐employed), budgeting, and food gardening. This approach can help to increase the resource base and alleviate food insecurity in low resource households.     

Consumer laundry practices in Germany

Sustainability is a guiding principle for a responsible, future‐oriented 21st century lifestyle and this already begins in private households with the daily household tasks. Approximately 25% of an average household's electricity consumption is required to do the laundry and dishwashing – 5% alone is for washing clothes with a corresponding energy consumption of 6 billion kilowatt hours. In addition, 600 000 tonnes of detergent and 330 million cubic metres of water are used for textile care in Germany. These figures provide the rationale for the scientific study of current practices of using washing machines and for a resulting estimate of the latent energy‐saving potential in German households. In the context of the in‐home study presented here, 236 private households throughout Germany were studied with respect to their washing practices and existing knowledge about topics on the sustainable, energy‐saving use of their washing machines. Overall, across all households 2867 wash cycles were individually recorded and subsequently analysed over a 4‐week period. The results of this study show that washing machines tend to be underloaded, and therefore maximum loading of the machines could lead to a reduction of wash cycles per household. With respect to detergent dosage, it was determined that the consumer does not adjust the dosage to the textile type, load size, soil level and/or water hardness, and this can lead to under‐ or overdosing depending on prevailing conditions. Finally, the selection of the wash temperature showed a 90°C/95°C programme was only chosen in 2.3% of all recorded wash cycles, however, every fourth cycle was completed at 60°C. Therefore, adjusting the load size and detergent dosage as well as selecting the right wash temperature are key themes to be taken into account in future consumer communication about energy‐saving households.     

浙江省地域资本禀赋差异及对经济韧性的影响

运用指标体系法对浙江省县域资本进行了测度，使用多因素方差分析不同地域资本类型地区的经济韧性，在上述基础上，运用巴罗线性区域增长模型分析了地域资本与经济韧性之间的关系。研究结果表明：地域资本最丰富的地区(类型Ⅰ)为杭州市区和宁波市区，地域资本较为丰富地区(类型Ⅱ)包括淳安县、临安市、安吉县等16个地区，中间区(类型Ⅲ)包括富阳市、桐庐县等13个地区；地域资本较稀缺地区(类型Ⅳ)包括建德市、磐安县等20个地区，低地域资本地区(类型Ⅴ)包括庆元县、遂昌县等15分地区；地域资本最丰富的地区(类型Ⅰ)比其他类型地区更有韧性，而低地域资本地区(类型Ⅴ)韧性最低。国际金融危机期间，人均GDP 与对最初冲击的抵抗力呈现正相关关系，与对缺口的阻力呈现负相关关系；外商直接投资越高的地区抵御冲击的能力越强；外部资本与人力资本对不同地区韧性均有显著影响，而集聚经济与韧性无直接关系；私营资本对韧性的作用较小。     

Effects of family livelihoods on household resource allocation in highly industrialized society

This contribution attempts to identify effects of the type of livelihood of rural family households on their economic behaviour. Economic behaviour is understood to be reflected in the total spectrum of income and allocation of household resources. A holistic approach must go beyond activity in the labour and consumer markets and include non-market (‘informal’) activities of household members, taking into account domestic production of goods and services, interaction within social networks, the use of public and commercial infrastructure, etc. Our study of resource income and allocation as a function of the household's livelihood undertook a comprehensive investigation of both market and non-market resources of the sample households. Results for full- and part-time farming family households, as well as for employee and self-employed households in the non-farm sector were compared. All survey households were comprised of four persons with an ‘intermediate’ level of family income living in disadvantaged rural areas. Apparent, but yet unquantified differences between these socio-professional groups, e.g. with regard to time-inputs into gainful activity, to regularity of income, and to joint accounting of the family and the firm/holding in self-employed households, had lent support to the hypothesis that there are marked differences in resource income and allocation strategies between these socio-professional groups. Survey results revealed, in quantitative terms, large workloads involved with self-employment, fringe benefits from dependent employment and, on the other hand, side-benefits from self-employment, such as the use of business stocks for private consumption. Compensatory effects of the disposition and use of non-market resources with regard to lower incomes was observed, as well as considerable differences between the socio-professional subsamples in strategies for and amounts of capital formation and social security. Furthermore, productive roles within the household, and the household's interaction with its social networks and other public and semi-public entities differed strongly between the socio-professional groups. Variance analysis disclosed that the findings on the above described differences in resource income and allocation between the socio-professional subsamples were statistically highly significant.     

Distributional Effects of Public Investment when Wealth and Classes are Back

In developed economies, wealth inequality is high, while public capital is underprovided. Here, we study the impact of heterogeneity in saving behavior and income sources on the distributional effects of public investment. A capital tax is levied to finance productive public capital in an economy with two types of households: high income households who save dynastically and middle income households who save for retirement. We find that inequality is reduced the higher the capital tax rate is and that low tax rates are Pareto‐improving. There is no clear‐cut trade‐off between efficiency and equality: middle income households’ consumption is maximal at a capital tax rate that is higher than the rate which maximizes high income households’ consumption.     

Determinants of Fresh and Frozen Fruit and Vegetable Expenditures in Turkish Households: A Bivariate Tobit Model Approach

In this study, we have identified the effects of socio-demographic and economic factors of household heads and households on monthly expenditures of fresh and frozen fruit and vegetable in Turkey using the bivariate Tobit model. The results show that both the probability and monthly spending levels of household fruit and vegetable consumption increase with increasing in age of household heads, educational levels of household heads, married household heads, household income, and the number of adults in a family, while male-headed households, working household heads, the households that receive in-kind help from the government or private sector, and the use of internet at home decrease both the likelihood and spending levels of fruit and vegetable consumption in Turkey. The results in the study may contribute to the stakeholders to identify and implement effective marketing strategies and also develop more effective policies for the government to improve nutritional levels for certain dwellings for which the government include them in the certain state-initiated benefit program.     

Repertoire of strategies used by French Canadian mothers living in Montreal to pressure their 10‐year‐old children to eat

This study is concerned with mothers’ use of strategies directed toward their 10‐year‐old children to pressure them to eat. The objective is to document the repertoire of strategies and their context of use. This child‐feeding practice is of interest because of its impact on the child's opportunities for the development of self‐control based on responsiveness to hunger and satiety cues. A total of 24 interviews and one focus group were conducted with French Canadian mothers. Data analyses reveal four major themes associated with the contexts in which pressure to eat were used: food purchasing, food preparation, meal service, food consumption. Strategies related to the context of food purchasing stress the importance of children's influence on family decisions. The strategies used at the time of preparation of meals illustrate the burden of tasks a mother takes on to ensure that her child consumes a particular food. With regard to meal service, very few strategies take into account the appetite of the child. Finally, the variety of strategies deployed at the time of consumption of foods supports the importance of informing parents of the undesirable effect of techniques associated with forcing the child to eat. Avenues for future research are presented.     

Neither passive nor powerless: reframing economic vulnerability via resilient pathways

ABSTRACT

Resilience, as an emerging construct within the contemporary field of consumer vulnerability, has received limited empirical attention within the context of economic adversity. This paper examines how low-income women strive to reframe their relationship to the market via resilient pathways. It establishes how through active agency, self-care practices and relational coping, women maximise care of self and care of others with limited economic means. Comprised of multidimensional coping resources for positive adaptation, resilient pathways offer vulnerable consumers distinct trajectories to well-being and overturn deficit-focused views about how those facing chronic economic disadvantage, (re)assert themselves in vulnerable consumption contexts.     

Inflation,R&D and growth in an open economy

This study explores the long-run effects of inflation in a two-country Schumpeterian growth model with cash-in-advance constraints on consumption and R&D investment. We find that increasing domestic inflation reduces domestic R&D investment and the growth rate of domestic technology. Given that economic growth in a country depends on both domestic and foreign technologies, increasing foreign inflation also affects the domestic economy. When each government conducts its monetary policy unilaterally to maximize the welfare of domestic households, the Nash-equilibrium inflation rates are generally higher than the optimal inflation rates chosen by cooperative governments who maximize the welfare of both domestic and foreign households. Under the CIA constraint on R&D (consumption), a larger market power of firms amplifies (mitigates) this inflationary bias. We use cross-country panel data to estimate the effects of inflation on R&D and also calibrate the two-country model to data in the Euro Area and the US to quantify the welfare effects of decreasing the inflation rates from the Nash equilibrium to the optimal level.     

Spend as I say,not as I do: Children,families and household consumption in different socio‐economic contexts

This article aims at contributing to a body of work about children and families by exploring the importance of socio‐economic context and social capital for understanding the ways in which money is perceived, obtained and used by children. Alleged contrasts in terms of money management, consumption priorities and postponement of gratification, especially among middle and working classes, have already been debated. It seems thus relevant to investigate if these presumable contrasts apply to children and why. Do children from different socio‐economic contexts reveal the traits that have been attributed to their households? To this end, a mixed methods research project was developed involving 245 children attending different primary schools in Portugal—one private school targeted at upper class children and one state‐sponsored school located in a working‐class area. The results revealed significant differences by school and household typology.     

Toward Consumption Reduction: An Environmentally Motivated Perspective

Faced with the threat of climate change, there is a challenge to promote more environmentally friendly consumption patterns. This work seeks to unearth psychographic and socio‐demographic factors that could trigger environmentally motivated reductions in consumption. The context of empirical investigation is the European Union (i.e., a large‐scale sample of European citizens), with a focus on two key types of environmentally motivated consumption reduction: domestic and “out‐of‐home” (purchasing) activities. The findings show the interrelated effects of environmental knowledge and ecological motivations (in both aggregated and disaggregated forms) on positive and negative environmental attitudes, which in turn influence consumption reduction. There is also evidence of significant moderating influences of perceived environmental threat, gender, age, education, and country value orientation—particularly on “environmental knowledge” links. The findings reported here contribute to theory and practice toward environmental sustainability.     

Depth versus Breadth Strategies for Global Brand Image Management

Abstract

Developing and maintaining a brand image is vital to any successful marketing and communication campaign. An image that clearly communicates the needs satisfied by the brand contributes to brand equity and helps combat brand parity. The normative model of brand image management suggests that marketers should base their images on a single set of consumer needs (depth strategy), rather than multiple sets of needs (breadth strategy). The extent to which depth strategies outperformed breadth strategies (in terms of annual change in sales volume, profit margin, and market share) was investigated for U.S. consumer goods exported into international markets. These markets varied in terms of level of economic development, cultural context, and competition. While the results indicate that depth strategies do tend to perform best, there are conditions under which breadth strategies perform just as well.     

Resilience and well-being production among vulnerable consumers facing systematic constraints

This paper explores how vulnerable consumers within systematic constraints of economic inequality, institutional barriers, and social segregation in an urban environment cope with their vulnerabilities to achieve their well-being. Taking China's internal migrant workers as a research context, our study examines their vulnerable experiences and reveals the impact of systematic constraints on migrant workers' self-perception, interpretation, and actions. It discovers a staged process through which migrant workers acquire resilience to optimize life satisfaction by fulfilling a sense of control over their migration life. Through a situated approach to capture the contextual impact of systematic constraints on vulnerability experiences and the construction of resilient pathways to achieve well-being, this paper puts forward critical welfare issues such as inclusive marketplace, social capital, and community empowerment which are important to migrants' social integration and capability building. This calls for more coordinated efforts to promote effective resilience building and sustained well-being among resource-constrained consumers.