Determinants of Urban Poverty in Oromia: A Case Study in Some Selected District, Ethiopia

Tamiru Gabusho

doi:10.7176/jpid/56-03

Abstract

The study was conducted in south west Shewa zone districts, Oromia National Region, Ethiopia. Stratified sampling techniques were applied in order to obtain a representative sample were selected to collect data by using these strata since in study there were constituted 3 urban areas were selected from a total of 4 towns in Waliso districts. Based on this condition sampling will be conducted separately in each subgroup or stratum. Descriptive statistics and binary logit were employed to determine factors that influence the economic status of households. A sum of twelve explanatory variables for the binary logit model was used, out of which eight variables were found to significantly affect the economic returns of households at 5%. These are: household family size, education of household head, the gender of household head, marital status, age of household head, , income of household head, house ownership, previous residence, and four of the following were at 10% like household health status, household head occupation, dependency ratio and saving of household and the other variables like household health status, household head occupation, and dependency ratio were not significant at a maximum of 10% significance level . The study recommends that the strong negative relationship between income and the probability of being poor point out that there must be a need to consider households income character by government and non-government organization in designing policies targeted to curb urban poverty intervening to household health status, household head occupation, dependency ratio and saving of household. Keywords: Rural poverty, Binary Logit Model, Waliso district. DOI: 10.7176/JPID/56-03 Publication date: November 30 th 2020

Highlights

Background of the StudyPoverty is viewed as encompassing both income and non income dimension of deprivation, lack of empowerment and extreme vulnerability to external shocks.Poverty is pronounced deprivation in wellbeing; extreme poverty is living on less than 1.9 USA dollars per day, and moderate poverty defined as less than 3.10 a day (World Bank, 2018)
Rural poverty and urban poverty differ on many levels, with distinctive environment based issues that characterize quality of life
Poverty in Ethiopia is more pronounced in the rural areas as compared to the urban areas

Summary

Introduction

Background of the StudyPoverty is viewed as encompassing both income and non income dimension of deprivation, lack of empowerment and extreme vulnerability to external shocks.Poverty is pronounced deprivation in wellbeing; extreme poverty is living on less than 1.9 USA dollars per day, and moderate poverty defined as less than 3.10 a day (World Bank, 2018). Ethiopia is one of the world’s poorest countries, where about 30 percent of the population lives under the poverty line, and 37 million Ethiopians remain either poor or vulnerable to falling into poverty in the week of a shock (World Bank, 2017). The situation worsened recently because of sharp increases in the prices of food and fertilizers on world markets, which made it more difficult for poor households in Ethiopia, as elsewhere, to secure adequate food supplies (Ayalneh, 2014). To overcome this problem the government of Ethiopia used policies and strategy that targeted the reduction of poverty

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