Abstract
This study aims at assessing the most prevalent type of poverty in rural Mozambique, and if the causes of chronic and transitory poverty are similar to recommended policy, strategies to address each of them caused by different factors. This paper concludes that, most poverty is transient (66%) than chronic (34%), unlike in earlier studies where the determinants of chronic and transient poverty are not necessarily similar. However, it is recommended to prioritize addressing the chronic poverty given its damaging and long-lasting effects. Also, it is believed that by addressing chronic poverty some synergies can be generated, which allow tackling of the transient poverty as well. The most important set of variables for transient poverty are the household landholdings, head’s age, family and hired labor, land quality, and livestock. All these covariates tend to increase the transient poverty, except the family labor which is likely to decrease it. The same variables are important to chronic poverty, in addition to education especially in men, where the number of members with self-employment and widowed household heads has a negative effect on chronic poverty. Policies aimed at reducing chronic poverty should concentrate more on improving household characteristics such as investing in education, agricultural reform that encourages landholding expansion and energy such as human power or animal traction for farming while reducing transient poverty would call for policies oriented at allowing economically active families to earn income for their livelihoods. Key words: Chronic, transient, poverty, Mozambique, panel data.
Highlights
The distinction between chronic and transitory poverty is based on Pitoro the framework developed by Jalan and Ravalion (1998), which recognizes that chronic poverty is as a result of household characteristics that prevent people from meeting their basic needs, resulting from long periods of limited income while transitory poverty is caused by income and other shocks associated with household characteristics, that prevent them from meeting their basic needs temporarily
Using the international poverty line of US$1.25 per capita per day based on parity purchase price (PPP), the poverty rate was much higher with similar trend at a slower pace, with the exception that the difference between the two survey periods is not significant
These poverty estimates are below those stated by MPD (2010) using consumption indicator and local poverty lines which in 2008/09 estimated 54.7% of people living in poverty in the entire country with the estimates at 49.6 and 56.9% in the Northern and Central Mozambique; respectively
Summary
It is important to mention that, a transient poor household has much higher ability to bounce back after a severe shock suggesting that, strategies to mitigate these shocks are likely to have great impact in preventing them to be poor in future. MPD (2010) reported that, one of the millennium development goals (MDGs) for Mozambique is to reach an absolute consumption poverty rate of 40% by 2015, from an estimated 80% in 1990. To reach this goal, the government has been implementing development projects aiming to meet three types of needs namely: primary needs, secondary needs, and other needs
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