the conflict was turbulent. In particular, the government temporarily removed a large fuel subsidy for the month of August that not only supported direct consumers of fuel, but also supported the transport of goods across the country and the use of fuel as an intermediate input of production. However, this temporary removal of the fuel subsidy did not appear to be driving the results. First, there was little-to-no immediate impact on expenditure for that month, where these outcomes only changed following the capture of Sana’a. Second, the subsidy removal was targeted at the entire country and not just Sana’a, whereas all the results analyzed here show a pattern of a clear change in Sana’a coupled with little change in the rest of the country.<sup>26</sup>

# **5c. Coping Strategies**

Given the unique opportunity to exploit a number of modules in the survey, this article further analyzes how households potentially coped with the capture of Sana’a. First, Table 3 re-estimates specification (3), but utilizes a number of indicators on the number, value, and source of loans made to the household.

First, the survey breaks up loans by source- where one of the most common sources of loans in the country was for households to make purchases on credit from a trader. Column (1) of table 3 estimates the change in the loans made from traders, and column (2) estimates the change in loans made from other sources (primarily relatives, friends, and banks). Column (1) demonstrates that there was an increase in the share of loans made by traders in all three months. However, the estimates are imprecise, and one cannot reject the hypothesis that there was no change in loans from traders over the entire post-conflict period (p-value of 0.245). Column (2) demonstrates very little change in loans from other sources as well.

However, when breaking up the pattern by education of the household head in columns (3)-(8) of table 3, a clear pattern emerges. Columns (3)-(5) respectively demonstrate that for households where the head did not finish primary school, there was a large increase in the number of loans from traders, there was a higher likelihood of a household having at least a single loan from a trader, and there was a larger total amount borrowed from traders. One can reject the hypothesis that there was no change in these three variables describing loans from traders (number of loans, likelihood of having a loan, and the value of loans) over the entire post-capture period at the one-percent significance level (p-values of 0.005, 0.009, and 0.008 respectively). Additionally, one can see in columns (3)-(5) of table 3 that the increase in loans from traders began immediately following the capture, which is also a time when these types of households were struggling and had lower expenditures (table 2, column 9).

However, columns (6)-(8) of table 3 demonstrate that there was little change in borrowing from traders for households where the head finished primary school. The magnitude of the coefficients are lower, and they are more imprecisely estimated. Although there are likely many coping strategies that are not observable using this household survey, the ones that are observable suggest there is heterogeneity in the types of coping strategies used by different

> 26Appendix 7 further demonstrates that the change in expenditure is similar when using the matching estimator proposed by Abadie et al. (2004).

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