Quarterly Journal of International Agriculture No. 2/05
Determinants of poverty in rural Ethiopia
Ayalneh Bogale
Alemaya University, Ethiopia,
Konrad Hagedorn
Humboldt University of Berlin, Germany,
Benedikt Korf
University of Liverpool, UK
Abstract
This paper investigates the determinants of rural poverty in Ethiopia.
Our study is based on information gathered from a three-round survey of
149 rural households in three districts of Ethiopia during the
1999/2000 cropping season. The FGT poverty index (index proposed by
Foster, Greer and Thorbecke) is employed to examine the extent and
severity of rural poverty. It reveals that nearly 40% of the sample
households live below poverty line with an average poverty gap of
0.047. The binary logit estimates shed light on factors behind the
persistence of poverty and indicates that rural poverty is strongly
linked to entitlement failures understood as lack of household resource
endowments to crucial assets such as land, human capital and oxen. Our
findings suggest that improved targeting devices can be a useful
instrument in reducing poverty, in particular to reach the poorest of
the poor.
Keywords: rural poverty, livelihoods, Ethiopia
Vol. 44 (2005), No. 2: 101-120