Adoption of the Wealth Index Approach in Analyzing the Determinants of Household’s Poverty in Tanzania

Abstract

This study examines the determinants of poverty in Tanzania using the 2015 Tanzania Demographic and Health Survey data. Ordered logit model was used to model the determinants of poverty and the study revealed that age, sex, household size, level of education, marital status, type of residence and access to financial services are significant in explaining the status of poverty. All of the mentioned variables are significant at 1% except sex of the household head which was significant at 5%. Since it is the global goal to reduce poverty, the study recommends that the government should invest more in education to improve knowledge and skills of individuals, improve financial services and financial inclusion especially in rural areas to eradicate poverty and remove rural-urban disparity.

Keywords: Poverty, Household, Wealth Index, Ordered logit model and Tanzania

DOI: 10.7176/JESD/12-14-03

Publication date:July 31^st 2021