Adaptive Responses and Asset Strategies: The Experience of Rural Micro-Firms and Foot and Mouth Disease

The 2001 Foot and Mouth Disease (FMD) epidemic effectively closed large parts of the UK countryside for several months. Local firms found their operations disrupted and suffered losses of trade. The individual and collective experiences of affected firms provide vivid insights into how rural businesses and the local economies they constitute operate and react in times of crisis, with important lessons for small business policy and support. Drawing upon survey and case study research the paper presents a critical incident analysis of the impacts of FMD on rural micro-businesses and a review of the resulting adaptive responses. The paper explores the role of variable endowments in influencing the choice of responses available to micro-businesses and identifies those assets which proved to be crucial in enhancing coping capability. The analysis confirms the importance of households in providing resilience to micro-businesses. Households acted as a buffer to many firms, absorbing revenue and employment effects, through adjustments in the wage taken from the business, restrictions in household spend, the deployment of personal savings and the use of household members as a flexible labour reserve.