Do market shocks generate gender-differentiated impacts? Policy implications from a quasi-natural experiment in Bangladesh

Using information collected from two rounds of household income and expenditure surveys (HIES 2005 and 2010) in Bangladesh, this study examines the gender-differentiated impacts of the commodity price hikes in 2008 on food and non-food consumption behavior based on the sex of the household head. Applying the difference-in-difference estimation method in a quasi-natural experiment setting, this study demonstrates that, in general, commodity price hikes more adversely affect female-headed households. In 2010, they reduced expenditures on food and non-food items, and particularly cereal, non-cereal, and education expenditures, more than male-headed households did. This study also shows that the impacts of commodity price hikes were lower on the female-headed households headed by educated females as well as those who owned larger pieces of land and received remittances. These subsets were not affected by the commodity price shocks as examined in 2010. The findings strongly suggest that the provision of both human and physical capital is instrumental in developing countries to empower female-headed households to enhance their buffering capacity to withstand economic shocks.