Assessment of Trends in Income Poverty in Nigeria from 2010–2013: An Analysis Based on the Nigeria General Household Survey

Abstract

ABSTRACTObjective: There are large gaps in the literature measuring levels of poverty and inequality within the six geopolitical zones in Nigeria and rural and urban areas. This study addresses this issue by using income measures to determine trends in the extent of poverty in Nigeria with regard to the geopolitical zones and between rural and urban areas.Approach: This paper compares the levels and distribution of income poverty using the Nigeria General Household Survey (GHS-Panel) datasets. These are analyzed using the Foster-Greer-Thorbecke (FGT) Pα class poverty measure to determine the headcount ratio, poverty gap and poverty gap squared. The Cumulative Distributive Function (CDF) is also derived. By comparing the income variables from wave 1 (2010–2011) with wave 2 (2012–2013) of the GHS-Panel in rural and urban areas and across the six geopolitical zones of Nigeria, the authors find that there was an overall deepening of poverty in Nigeria between 2010 and 2013. The northern zones and in particular, the North West zone, overwhelmingly dominate both the incidence and share of poverty compared to the southern zones.Implication: The analysis shows unambiguously that the federal government needs to urgently implement policies that will bring about improvements in the living standards of poor people in all the six geopolitical zones of Nigeria. The aims of these policies should explicitly be poverty reduction and amelioration.Value: The paper addresses the issue of income poverty using aggregated and disaggregated poverty indicators in the six geopolitical zones of Nigeria and the rural and urban areas to understand the complexity of poverty between and within each of the zones and rural and urban areas across the country.