Determinants of Household Level Urban Poverty the Case of Wolaita Sodo Town

Abstract

The study was carried out at sodo town of Wolayta Zone in Southern Nation Nationalities Regional State with the main objectives to describe correlates or determinants of urban poverty in the study area. In order to attain this objective the study made use of cross-sectional household survey data collected from 240 sample households. The data collected were analyzed and discussed applying FGT measure of poverty i.e. poverty head count index, poverty gap and severity, determinant was done by using binary logit model. By Using cost of basic needs approach; the study found that total poverty line (food and nonfood poverty line) of the study area was about 3694.08 birr per year per adult equivalent consumption. Using this poverty line as bench mark the study indicated that 52 percent of the households were poor. The result of the logistic regression model revealed that out of 13 variables included in the model, 8 explanatory variables were found to be significant at 1%, 5% and 10% level. Accordingly, family size was found to have positive association with poverty of the household and statistically significant. while, access to credit, household health, remittance, sex, access to main road, employment and education were found out to have strong negative association with the households poverty status and statistically significant up to less than 10% level of significant.

Keywords: Binary Logit, Cost of Basic Need, Consumption approach, Determinants, Household, Urban poverty, wolaita sodo