The Heterogenous Effects of the Covid-19 Pandemic on Household Finances in the Metropolitan City of Chennai, India

Abstract

The economies of the world are still in the process of recovering from the effects of the covid-19 pandemic. The pandemic has affected the world in diverse ways. It has led to the loss of many human lives, affected public health, and also disrupted the economic activities of all nations. The market forces of demand and supply were adversely hit by the pandemic. It has greatly affected the welfare of the households, causing loss of income, a decrease in consumer spending and savings, and creating a debt burden for many households. Many households have been pushed into conditions of poverty after the outbreak of the pandemic. The present study delves into the heterogenous effects of the pandemic on household finances in the metropolitan city of Chennai. Chennai is a city that accommodates people from varied socio-economic backgrounds. Despite being a city that attracts a migratory population due to the availability of tremendous opportunities, the households in the city were not spared from the effects of the lockdown during the pandemic. The present study focuses on the effects of the pandemic on the finances of households belonging to different economic conditions. It also studies the different strategies adopted by households to cope with income loss during the pandemic. The overall impact of a pandemic on the levels of income inequality among households has also been analyzed. Understanding the severity of the impact on different households can pave the way for designing appropriate policies to provide essential support to the most vulnerable sections of society.