Risk, Uncertainty and Consumption-Smoothing Mechanisms: Evidence from Thai Household Socio-Economic Panel Data

摘要

This paper examines the consumption-smoothing mechanisms of Thai agricultural households using data from the Thai household socio-economic panel surveys conducted from 2005 to 2007. The study finds that households heavily depend on their saving mechanisms when smoothing their consumption in the face of an income shock. There is little evidence to show that households depend on borrowing and increased work hours to counteract income shocks. The results also show that savings have a positive significant relationship with income variance in every region, whereas households do not respond to future income uncertainty by borrowing or increasing work hours in all regions.