Analysis of the Effect of the Rising Sugar Prices on the Welfare of Households: A Case Study of Kawempe Division

Abstract

This study was carried out to investigate the effect of rising sugar prices on the welfare of households with main emphasis put in Kawempe Division. In order to meet the main objective of the study, the research intended to assess the effect of rising sugar prices on the level of sugar consumption, to find out the relationship between sugar consumption and household size and to assess the effect of sugar prices on income of households. Secondary data and primary data obtained using structured questionnaires were used and 72 respondents were interviewed. Analysis was done under two stages that is univariate and bivariate. With univariate analysis, it showed that majority of household heads were males, aged between 31-40, were inform/non-permanent employed, had been to secondary, with their household size ranging between 1-3, had their earning ranging between 200001-400000 Ugandan shillings, with sugar consumption ranging between 2-3kgs and were affected by the rising sugar prices with the average price of sugar as 2210.319 Ugandan shillings. Based on detailed results of the study using bivariate analysis, it showed that the rising sugar prices have no effect on the amount of sugar consumed implying that an individual will not increase the amount of sugar consumed because of a decrease in the sugar prices neither will the individual decrease the amount of sugar consumed due to an increase in sugar prices, there is a relationship between sugar consumption and household size implying that the larger the household size the more amounts of sugar consumed and rising sugar prices had no effect on the income levels of the households thereby implying that there are no changes in the households’ income due to rising sugar prices. In conclusion, welfare is mostly obtained from consumption of goods and services, if at all households increase on their consumption levels of sugar, they will be influencing their welfare positively leading to better and improved wellbeing Ceteris Paribus and the government should also come in to setup policies which can help stabilize the rising sugar prices to benefit both producers of sugar through reduced costs of production and later households who are to enjoy stable prices. This study was only limited to effects of rising sugar prices on welfare of households however researchers can extend the study to assessing the effect of rising sugar prices on the standards of living of households and assessing the impact of price increase on welfare of poor households.