Spatial Decomposition of Poverty in Rural Nigeria: Shapley Decomposition Approach

Abstract

Poverty is largely a rural phenomenon in sub-Saharan Africa. The contribution of mean income and inequality to spatial variations in rural poverty were investigated in this study using the 2003/04 National Living Standard Survey by the National Bureau of Statistics (NBS). The data were analyzed using descriptive statistics and Shapley Decomposition (SD) techniques. Results showed that across the GPZs, the contribution of mean income to poverty was higher than inequality (Ly) for both P₀ and P₁.The contribution of mean income to severity of  poverty (P₂) was higher than Ly in North-East (µ = -0.0530; Ly = -0.0334); North-West (µ = -0.0844; Ly =0.0429); South-East (µ = 0.0505; Ly = 0.0136); South-South (µ=0.0254; Ly=0.0048); South-West (µ = 0.0450; Ly = 0.0201). However, inequality contributed more than mean income in North-Central (µ = -0.0184; Ly = 0.0240). The marginal contribution of within-GPZs inequality to poverty indices were higher than between-GPZs inequality.

Keywords: Poverty, inequality, decomposition, Shapley and rural