Impact of changes in assets on consumption expenditures of poor households

Poverty alleviation continues to be a major development priority, particularly in regions where households rely on limited and vulnerable assets to sustain livelihoods and maintain consumption. Assets serve not only as stores of value but also as critical mechanisms for consumption smoothing during periods of economic shock. While prior research has extensively examined income-consumption relationships, empirical evidence on the influence of asset variation on household consumption, especially among poor households, remains limited. This gap has become increasingly relevant in the context of the COVID-19 pandemic, which has severely disrupted the economic capacity of low-income communities. This study examines the impact of changes in household assets on consumption expenditures among poor households during the COVID-19 crisis. Primary data were collected from 94 respondents in Southern Aceh Province, Indonesia, through structured questionnaires. Using multiple linear regression analysis, the study assesses how changes in assets, namely livestock, land, and financial savings, as well as employment status, household size, age, and government social assistance, affect household consumption patterns. The results reveal that asset accumulation, employment, family size, and social assistance significantly and positively influence consumption expenditures. However, age is negatively associated with spending, suggesting more conservative consumption behavior among older household heads. Despite some improvements in asset conditions, poor households’ expenditures remain focused on basic needs, with minimal allocation toward education, highlighting persistent vulnerability. The findings emphasize the importance of asset-building policies and sustained government support in protecting poor households during crises. Policy recommendations include expanding access to microfinance, implementing targeted asset transfer and insurance schemes, and maintaining adaptive social protection programs. Future research should explore the long-term and intergenerational effects of asset growth and assess the role of social capital in enhancing resilience. Longitudinal and cross-regional studies are essential to inform more effective and inclusive poverty alleviation strategies.