HOUSEHOLD INCOME DIVERSIFICATION AND FOOD SECURITY IN SRI LANKA

Abstract

Diversifying income sources is recognized as a crucial strategy to boost earnings, mitigate risk, and reduce economic vulnerability. Despite its importance, the relationship between food security and income diversification in Sri Lanka hasn’t received sufficient attention. Therefore, this study investigates how Sri Lankan food security is impacted by income diversification by analyzing 19,783 national representative households' data taken from the 2019 Household Income and Expenditure Survey (HIES). The nutrition-based Food Security Index (FSI) was used to assess food security. Food security is measured by dividing the daily calorie intake by the recommended per capita daily calorie intake of all household members. An FSI value below 1.0 indicates food insecurity, while values at or above 1.0 indicate food security. Income diversification was measured using Simpson's Index of Diversity (SID), with households possessing multiple income sources classified as having diversified income portfolios. Descriptive statistics, multiple linear regression and probit regression were used to analyze the data. The results reveal that over half of households have a variety of sources of income, indicating that households typically rely on multiple sources of income rather than just one, and FSI, with a mean of 1.11, suggests that households are food secure on average. Ultimately, the analysis revealed that the household food security in Sri Lanka is positively and significantly impacted by income diversification. Sectoral analysis indicates that rural and urban households have wider income sources compared to households in the estate sector, while the estate and rural sector households are generally food secure, compared to the households in the urban sector. These findings highlight the importance of promoting income diversification strategies among Sri Lankan households to enhance food security and build resilience against economic shocks in Sri Lanka.

Keywords: Food security; Household income; Income diversification; Rural-urban disparities; Sri Lanka