Explaining Multidimensional Poverty: A Household-Level Analysis

Abstract

A multidimensional poverty index is constructed for the Philippines using the Alkire-Foster methodology and data from a 2011 annual poverty indicators survey. This is disaggregated into urban and rural population groups, as well as by dimension and administrative region. At the province level, the study finds a positive relation between poverty incidence and intensity, but the highest intensity levels are experienced in areas where incidence is not that high relative to other areas. Provinces with high incomes generally have low poverty indices and the relationship appears to be nonlinear. An examination of household poverty using mixed logit analysis shows that poverty risk rises with household size. A substantial reduction of the risk is observed for households with heads who were able to matriculate high school. The household head's health status has a negative impact on the household's risk of being poor. These are contrasted with the results using the income poverty definition. Policy implications are drawn from the calculations and the econometric results.