Magnitude and determinants of rural household poverty in central Ethiopia

132 Pages·2016·3.8 MB·English

J
.1 1 AOUT 2003
) ' .
~ i . ~ ,' ·, ....- .' ' ;
MAGNITUDE AND DETERMINANTS OF RURAL HOUSEHOLD POVERTY IN
CENTRAL ETIDOPIA: THE CASE OF BEREH-ALELTU DISTRICT
A THESIS PRESENTED T@
THE SCHOOL OF GRADUATE STtmIES
ALEMA YA UNIVERSITY
Y
R
A
R
B
IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR.THE DEGREE OF
I
L
MASTER OF SCIENCE IN AGRICULTURAL ECONOMICS

-

A
I
R
S
E
BY
D
ADANE NABSO FUFA
O
C
January, 200J
\
.. ,
'
SCHOOL OF GRADUATESTUDIES
ALEMAYA UNIVERSITY
Title of Thesis
Magnitude and Determinants of Rural Household Poverty in Central
Ethiopia: The Case of Bereh-Aleltu District
'
By
Y
Adane Nabso R
A
R
Approved by Board ofExaminers
B
I
L

Dr. Teressa Adugna -

A
- Ch.aimrnn
I _:,~..
R
,,
Dr. B'ezabih Emima
S
Major Advisor Signature
E
D
Dr. Ayalneh Bogale
O
·'
Internai Examiner Si ture
C
Dr. Abebe II/Gabriel
Extemal Examiner
\
•
1
Dedication
This thesis is exclusively dedicated to all povertv prone peopYle.
R
A
R
B
I
L

-

A
I
R
S
E
D
O
C
il
Biographical Sketch
The author was bom in West Shoa Zone of Oromia Regional State, Bako District, Ethiopia on
October 20, 1977 from his father Nabso Fufa Ababulo and his mother Zewdie Kure Gemechu.
He pursued his education at Keku Bekerere Elementary School, Sheboka Junior Secondary ·
School, and Gedo Senior Secondary School.
After passing the Ethiopian School Leaving Examination successfully, he Yjoined Alemaya
R
University in 1995/96 academic year and graduated with B.Sc. degree in Agricultural
A
Economies on 10th July 1999.
R
B
I
Irnmediately, the author was employed by Oromia PlaLnning and Economie Development on

-
August 21, 1999, and served at branch office of Western Hararghe Zone for two years as an

A
expert in the planning production section.
I
R
S
In 2000/2001 academic year, hEe joined the School of Graduate Studies at Alemaya University
D
in Agricultural Economies Department.
O
C
111
ACKNOWLEDGEMENTS
I would like to express my sincere thanks and appreciations to . my advisor, Dr. Bezabih
Emana, whose cogently analysis and line-to-line comments were present from the inception of
the proposai, questionnaire design until the completion of the thesis. His consistent ad vice and
prompt correction diligently has encouraged me to progress the study. Without his heartfelt
assistance, the completion of this thesis on early time would have been impossible.
I would like to ta'lle this opportunity to extend my deepest gratitude
Y
11.nd appreciation to Council for the Development of Social Science Research
R
in Africa (CODESRIA) for their sponsoring or financial support, which is to
A
be used in covering the research, expenses under their small grants
programme. I acknowledge to all Executive Committee Rof CODESRIA being they
selected me and has been making this type of gBranting programmee for the
youth African's.
I
L

Finally, my deepest gratiful thanks must be addressed to the programme
-

assisatant, Virginie Niang who frequently and promptly used to informed
A
the status of the grant through e-mail.
I
R
Among ail, my gratitude is also coSnveyed to some of staffs of Alemaya University, namely,
Mr.Adem Kedir and Mr.Jeylan EWoliyi for their moral support and informai discussions I had
with them. D
O
Though it is impossible to mention ail of the persans, my thanks should also go to my parents,
C
relatives, and friends for their patience and the contributions they made me when I stayed on
the study.
IV
TABLE OF CONTENTS
BIOGRAPHICAL SKETCH ....................................................................................... 111
ACKNOWLEDGEMENTS ......................................................................................... IV
TABLE OF CONTENTS ............................................................................................. V
LIST OF TABLES .................................................................................................... VIII
Y
LIST OF FIGURES ..................................................................................................... X
R
LIST OF APPENDICES ............................................................................................. XI
A
R
ACRONYMS AND ABBREVIATIONS ...................................................................... XII
B
ABSTRACT ............................................................................................................. XIII
I
L
CHAPTER ONE: INTRODUCTION .................. .......................................................... 1
-

1.1 Background ................................................A........................................................................... 1
I
R
1.2 Statement of the Problem ...................................................................................................... 2
S
1.3 Objectives of the Study ......E................................................................................................... 6
D
1.4 Significance of the Study ....................................... '. .............................................................. 6
O
1.5 Scope and LimCitations of the Study ...................................................................................... 7
CHAPTER TWO: REVIEW OF LITERATURE ........................................................... 8
2.1 Concepts and Definitions of Poverty ..................................................................................... 8
2.2 Measurement and Indicators of Poverty .............................................................................. 12
2.3 Empirical Findings .............................................................................................................. 20
2.4 Poverty Reduction Strategies .............................................................................................. 25
V
CHAPTER TH REE: METHODOLOGY ..................................................................... 28
3.1 Description of the Study Area ............................................................................................. 28
3.2 Methods of Data Collection ................................................................................................ .32
3.3 Methods of Data Analysis ................................................................................................... 34
3.3.1 Poverty Indices ........................................................................................................... 34
3.3.2 The Madel ................................................................................................................... 38
3.3.3 Hypothesis Setting ...................................................................................................... 42
3.3.4 Methods ofEstimation ................................................................................................ 46
Y
R
CHAPTER FOUR: RESULTS AND DISCUSSION .................................................. 53
A
4.1 Magnitude of Poverty .......................................................................................................... 53
R
B
4.2 Description of the Sampled Household Characteristics ...................................................... 56
I
4.2.1 Family size ........................................................L.......................................................... 56

4.2.2 Age Structure .............................................................................................................. 58
-

4.2 3 Educational Status ..............................A........................................................................ 61
I
4.3 Farming Practice of the Household ..R................................................................................... 63
4.3.1 Land Use Pattern ................S......................................................................................... 63
4.3.2 Major Crops ................E................................................................................................ 64
D
4.3.3 Livestock ownership ................................................................................................... 65
O
4.4 Incarne and Expenditure of the Household ......................................................................... 68
C
4.5 Major Agricultural Constraints ........................................................................................... 73
4.6 The Cause and Effect of Poverty at the Community Level.. ............................................... 75
4.6.1 Accessibility ta Public Services .................................................................................. 75
4.6.2 Health Problems .......................................................................................................... 76
4.6.3 Water. .......................................................................................................................... 77
4.7 Determinants of Poverty at the Household Level.. .............................................................. 78
Vl
4.8 Marginal Effects ofExplanatory Variable .......................................................................... 88
4.9 Coping Mechanisms at Household Level.. .......................................................................... 89
CHAPTER FIVE: SUMMARV AND POLICV IMPLICATIONS ................................. 92
5.1 Summary ............................................................................................................................. 92
5.2 Policy Implications .............................................................................................................. 95
REFERENCES ......................................................................................................... 98
Y
APPENDICES ..................................................................................R...................... 105
A
R
B
I
L

-

A
I
R
S
E
D
O
C
vu
List of Tables
Table 1. Developrnent lndicators for Sorne of the SSA Countries-------------------------------- 13
Table 2. Poverty Levels in selected SSA Countries------------------------------------------------- 14
Table 3. Summary of Selected Rural Poverty Determinants -------------------------------------- 24
Table 4. Sarnple Size by Peasant Associations ------------------------------------------------------ 32
Table 5. Distribution of Sarnpled Household Expenditure by Groups and the Poverty Index 54
Y
Table 6. Calorie lntake per AE per day of the Sarnpled Household and its PRoverty index --- 55
A
Table 7. Distribution of Family Size by the Household Group (No.)---------------------------- 57
R
Table 8. Distribution of Family Size (AE/HH) ------------------------------------------------------ 58
B
Table 9. Distribution of the Head of Household Age in Y Iear ------------------------------------- 59
L

Table 10. Distribution ofFamily Size in the Working Age group
-

A
ranging frorn 14 to 64 Years per HH (No.)---------------------------------------------- 60
I
R
Table 11. Distribution of Nurnber of Children Less than 14 Y ears/HH. ------------------------- 61
S
Table 12. Literacy Status of the Household Head----------------------_----------------------------- 62
E
Table 13. Land use pattern Din hectare/ HH --------------------------------------------------------- 64
O
Table 14. Area allotted to Major Crops per HH in hectare.---------------------------------------- 65
C
Table 15. Average livestock Owned by Type per HH---------------------------------------------- 66
Table 16. Distribution of Livestock Holding (TLU/AE)------------------------------------------- 67
Table 17. Nurnber of Ox Owned per HH------------------------------------------------------------ 68
Table 18. Arnount of Non-Farm Incarne per HH per year (Birr) --------------------------------- 69
Table 19. Total Value of Own Crop Production Consurned/AE/ in 2001/02 (Birr)------------ 70
Table 20. Total Value ofLivestock Product Consurned/AE/ in 2001/02 (Birr).---------------- 71
Vlll
Table 21. Cash Incarne from sale animal products and crop produced in 2001/02------------ 71
Table 22. Expenditure by Group of Food and Non Food in 2001/02----------------------------- 72
Table 23. Summary of mean incarne and Expenses in birr per year by household groups---- 73
Table 24. Number of Households Ranking the Problems (Matrix Ranking)-------------------- 74
Table 25. Proximity to Public Services in KMs ---------------------------------------------------- 76
Table 26. Sources of Water and Means of Transport ---------------------------------------------- 78
Table 27. Definition of Explanatory Variables ----------------------------------------------------- 79
Y
Table 28. Descriptive Summary of Continuons Explanatory Variables------------------------- 80
R
Table 29. Descriptive Summary of Discrete Variables-------------------A-------------------------- 81
R
Table 30. Measure of Tolerance for Continuons Explanatory Variables ----------------------- 82
B
Table 31. Contingency Coefficients of Discrete Explanatory Variables------------------------- 83
I
L
Table 32. Maximum Likelihood Estimates of Logit Mode!--------------------------------------- 84

-

Table 33. Marginal Effects ofExplanatory Variables on Probability ofbeing Poor----------- 89
A
I
Table 34. Number of Households with different Coping Strategies------------------------------ 91
R
S
E
D
O
C
ix