Poverty Gap Research Articles

Out-of-Pocket Health Care Expenditure and Poverty Impact in a Fragile Indian State of Assam

Out-of-Pocket (OOP) expenditure on health care is one of the debilitating factors in pushing households into poverty. Households, especially the lower income groups and which do not have security measures like medical insurance, are the worst sufferers when faced with health shocks. Conventional methods of poverty estimation do not take into account health care consumption expenditure, which might understate the poverty headcount. In this study, poverty headcount and impoverishing effects of OOP health care expenditure have been analysed. The data have been collected from Chirang district of Indian state of Assam. The state is a fragile state due to ethnic violence, militancy and natural calamities like flood that the region has been experiencing for decades. The recall period for the inpatient care is 365 days, and six months for outpatient care. The poverty headcount is the difference between post Hp and pre Hp. The pre-payment (i.e. pre-OOP) ‘poverty headcount’ is calculated by comparing household’s consumption expenditure gross of payments for health care with the poverty line defined by the planning commission of India (2001). The post-OOP payment ‘poverty headcount’ is computed by netting out health care payments from a household’s consumption expenditure and then comparing with the poverty line. The intensity of poverty has been estimated with the help of the methods introduced by Wagstaff and Doorslaer (2003). The higher income households make higher OOP expenditure than the lower income households. The burden of OOP is higher on the lower income households because the proportion of OOP expenditure to total income of households is higher amongst the poor households compared to higher income households. OOP expenditure pushed households into poverty. This is more serious with the inpatient care compared to the OOP expenditure on outpatient care. The poverty gap or the intensity of poverty of the overall OOP expenditure is Rs. 279.28, which varies between outpatient and inpatient OOP expenditure.

Financial inclusion and gender-induced poverty in Nigeria

The goal of this study was to see how financial inclusion affects gender-based poverty in Nigeria. Commercial bank branches, deposits, and borrowers were the proxy for financial inclusion. The poverty index was used to measure poverty reduction. The World Development Indicator (WDI) and the CBN Statistical Bulletin 2021 provided the data for this study. Finally, the study included the years 2002 to 2019. Financial inclusion reduces household poverty in Nigeria, according to the study, which used a VAR estimate. The coefficients of commercial bank branches and commercial bank deposits were (-0.004) and (-0.008), respectively, indicating that they had a negative influence on poverty reduction. Furthermore, the study discovered that having access to credit through a financial institution was crucial in lowering poverty in Nigeria over the study period. As a result, the report recommends that steps to promote the rule of law, particularly contract enforcement and financial regulatory inspection, be implemented, resulting in more financial inclusion and a reduction in poverty and income gaps, particularly between men and women. The benefits of financial inclusion must be made more widely known, particularly in rural regions, through promoting financial literacy among the poor through education, advertising, and traditional institutions.

Do international remittances promote poverty alleviation? Evidence from low- and middle-income countries

Abstract Unlike previous empirical studies, this paper investigates the contemporaneous and lagged impacts of international remittances on poverty alleviation using data for 65 low- and- middle-income countries from 2002 to 2016. By using two-stage least square (2SLS) regression analysis, this study establishes that, in general, international remittances per gross domestic product (GDP) significantly mitigate poverty. On average, a 10-percentage-point increase in remittances will lead to a similar decrease in the poverty headcount ratio at USD 1.90 a day, a 4.8-percentage-point decline in poverty gap ratio at USD 1.90 a day, and a 6.7-percentage-point reduction in the poverty gap ratio at USD 3.20 a day. This result remains robust with the inclusion of political factors in the model. Moreover, the system-generalized method of moments (SGMM) estimations found that the contemporaneous effects of international remittances are much more substantial than their lagged effects. This indicates that most of the poverty alleviation role of remittances is contributed by its direct effect on increasing the wealth index of recipient households rather than the spillover effect on other members of the community. Therefore, we strongly suggest that efforts be made to improve the remittance infrastructures, especially in recipient countries, and the development of cooperatives in the enclaves of migrant workers to spread the beneficial effects of remittances to all members of society.

The Impact of Knowledge-Building Curricula on Reading Achievement: Closing the Poverty Gap

The purpose of this study was to examine the effects of knowledge-building curricula on closing the opportunity gap between students from lower socioeconomic backgrounds compared to more affluent peers. Data consisted of fourth through eighth-grade students’ reading achievement levels on state- wide summative reading assessments from 2015 to 2019 attending US school districts implementing, and not implementing, knowledge-building curricula. Of the school districts implementing knowledge-building curricula, four separate knowledge-building curricula were analyzed among six experimental districts. We found statistically significant differences in the frequencies of students performing at varying proficiency levels between districts that implemented a knowledge-building curriculum versus districts that did not. A greater frequency of students than expected who were attending school districts implementing a knowledge-building curriculum was performing at higher proficiency levels compared to matched controls in twenty-two of twenty-seven comparisons. Overall, our study found that there is evidence to the claim that exposure to knowledge-building curricula closes the opportunity gap in reading achievement for students residing in economically disadvantaged environments.

Status of Rural Household Poverty in West Hararge Zone: In Case of Some Selected Woredas, Oromia, Ethiopia

This study was conducted in a rural area of West Hararghe zone to evaluate the status of household rural poverty. To undertake this study, both primary and secondary data were used. The data was collected from 375 sample households for the study purpose. In doing so, the maximum likelihood estimation method of the logit model was applied to estimate the logit regression model. The study used consumption expenditure as an indicator of welfare in general and the cost of basic needs approach in particular to classify households as poor and non-poor. The result of this study shows in the study area the proportion of people who are stated under the poverty line is 52.8 percent from the surveyed households. The incidence of poverty among the sampled households is 23.8% and 13.54% for the poverty gap, and poverty severity index respectively. In line with, poverty alleviation policies that are based on this identified status should be key ingredients of poverty reduction strategy and targeted groups should involve in development efforts that could address the identified problem to minimize the rate of increased poverty severity from rural areas of West Hararge zone.

Contextualizing Poverty along with the Sustainable Development Goals (SDG’s) 3, 6 and 9 as nonincome indicators in Ocampo, Camarines Sur Philippines: Evidences from CBMS 2019

Measuring poverty using non-income indicators enable countries to target and develop programs for poverty alleviation and understand its performance towards the sustainable development goals (SDG’s). This paper which seeks to evaluate the performance of the municipality of Ocampo in Camarines Sur, Philippines towards the SDG’s via the Community-based Management System (CBMS) would enable policymakers to target recipients of government programs and interventions in the municipality. This paper looked into the responsiveness of the municipality of Ocampo, Camarines Sur to the SDGs by identifying the household poverty index; poverty gap index and poverty severity index as well as estimating the probability of households in Ocampo, Camarines Sur to becoming poor using non-income indicators which are connected with the SDG’s. Employing the Foster-Greer-Thorbecke (FGT) poverty measures, and logistic regression, the researcher found that around 64.5% of the households in the municipality of Ocampo, Camarines Sur are poor. Likewise, majority of the poor households in the municipality don’t have access to clean and safe water, toilet facilities and internet and electric connectivity. However, despite them being poor, the residents of Ocampo visits medical facilities and received medical treatments if they are sick. The municipality does well in SDG 3, good health and well-being. To further strengthen the municipality’s responsiveness to the SDG’s, there is a need to strengthen barangay health units, develop local water sources and further access to internet connectivity.

IMPACT OF CROP PRODUCTIVITY ON POVERTY AMONG FARM HOUSEHOLDS IN GHANA

Ghana Poverty Reduction Strategy I & II sought to increase crop productivity to reduce high poverty incidence in farm sector, but the magnitude of impact of the productivity on poverty is not present in all agro-ecological zones in Ghana. The aim of the study is to estimate poverty headcount ratio, poverty gap and poverty severity, and link crop productivity to poverty according to agroecology subject to a two-step instrumental variable regression technique using Pseudo Panel data from the Ghana Living Standards Survey (GLSS rounds 5 & 6). Farmers’ poverty headcount ratio, poverty gap, and poverty severity reduced from 57%, 25%, and 14% in 2005 to 37%, 14%, and 7% in 2013 respectively. The result further indicates that 1% growth in crop productivity reduces the probability of poverty headcount ratio, poverty gap and poverty severity by 0.28%, 0.38% and 0.75% respectively in all agro-ecological zones. Additionally, the paper shows that education, livestock and remittance income reduces poverty, while household size and great distance to access water increase poverty differently from agro-ecology. The study recommends rapid crop productivity growth by prioritizing technology adoption and institutional coordination to suit agro-ecological conditions among the poor, illiterate and non-partisan.

Hubungan program keluarga harapan (PKH) dengan tingkat kemiskinan di daerah tertinggal dan non tertinggal di Indonesia

Conditional cash transfer (CCT),known as the Program Keluarga Harapan (PKH), is a social assistance instrumentto reduce poverty in Indonesia. Therefore, this study examines the relationship of PKH in reducing the poverty rate in Indonesia andthe differences in its effects on less-developed and developed regions. This study uses panel data from 512 districts/cities in 2015-2019 with the fixed-effect model (FEM) estimation. The results show that PKH has a negative and significant relationship to the poverty rate in Indonesia, both in less-developed and developed regions, where its effect in reducing poverty rates is smaller in less-developed regions than in developed regions. It can happen because conditions in less-developed regions generally have a higher poverty gap, difficult regional accessibility, fairly high exclusion and inclusion error factors, and relatively limited basic education facilities compared to developed regions.

The Effect of Rural Development on Poverty Gap, Poverty Severity and Local Economic Growth in Indonesia

The effect of rural development in reducing the poverty gap and economic growth has not been much analyzed in recent studies. This study examines the effects of rural development (as calculated by using the Village Development Index, VDI) on poverty and economic growth. Precisely, poverty is measured by the depth of poverty (as measured by Poverty Gap Index, P1) and poverty severity (as measured by Poverty Severity Index, P2) using the aggregate data at the district level in Indonesia. Understandably, many factors influence the effort to reduce the poverty gap in rural areas, and it can be started by improving rural economic development. The result of this study indicates that regions with the VDI categorized as “self-sufficient” and “developed” villages have the potential to reduce the depth of poverty and poverty severity in its areas and to increase economic growth. In contrast, underdeveloped and very underdeveloped regions in their VDI category experienced a more significant gap in the depth and severity of the poverty. This result implies that the Indonesian government must accelerate and improve the development of rural areas, especially in less developed regions. Thus, a better rural development status will attract more opportunities to grow rural economic activities and improve the community welfare.

Assessing the poverty impact of the COVID-19-induced tourism crisis in Tanzania: a social accounting matrix microsimulation analysis

The COVID-19 pandemic has caused major disruptions to international tourism and has stimulated research interest. This study examines links between COVID-19-induced tourism disruption and poverty in Tanzania. Unlike previous studies linking COVID-19, tourism and poverty, this paper uses a social accounting matrix (SAM) microsimulation analysis that allows decomposition of poverty indices by population subgroup and assessment of the drivers of aggregate poverty. The results of the SAM multiplier analysis indicate that all households will experience reduced incomes, and that this effect will be more pronounced in urban than rural households. The microsimulation results suggest that the COVID-19-induced tourism crisis will exacerbate the poverty headcount, poverty gap and poverty severity, with urban and rural non-farm households being most affected. The results of the poverty decomposition show that the growth effect has a stronger impact than the inequality effect on increased poverty. Poverty increases and inequality decreases simultaneously. The paper suggests several demand- and supply-side policies that may help to build tourism resilience and recovery and alleviate poverty in Tanzania in the post-COVID world.

The Equity Effects of Cadasters in Colombia

Well-functioning cadasters help to secure property rights, make economies perform more efficiently and promote environmental conservation. However, their equity effects are less known. Our study addresses how and to what extent cadasters, and reforms to them, affect equity. We address this question through an ex-ante simulation methodology using static partial equilibrium fiscal incidence analysis. We apply it to a recent expansion of the cadaster in Colombia, designed as a deliberate equalisation strategy in one of the world’s most unequal countries. This expansion will increase the collection of property taxes paid by previously informal households by about US$ 22.1 million and their net worth by about US$ 4,993 million (or about 3.2 and 4.9 per cent of their baseline value). However, the expansion of the cadaster will also increase the incidence of poverty (by 0.25 per cent points), the poverty gap (by 0.20 per cent points) and inequality (by 0.12 per cent points of the Gini index), unless generous compensatory interventions are applied. We conclude that equity effects of cadasters are complex and multiple. Policy-wide, compensatory measures are needed to alleviate the immediate impacts on poverty and inequality after the increase in taxes that vulnerable and poor households will likely face following a cadaster reform.

Analysis of Factors Affecting the Poverty Gap Index in Aceh Province 2017-2019

The poverty gap index in Aceh Province during the 2017-2019 period tends to decrease. This study aims to determine the appropriate modelling in finding the factors that affect the poverty gap index in Aceh Province. The data used is secondary data obtained from the Central Statistics Agency for Aceh Province from 2017-2019. The dependent variable used is the poverty gap index (P1). Meanwhile, the independent variables are the open unemployment rate, crime rate, dependency ratio and sex ratio. The best model obtained is the Fixed Effect Model (FEM). The factors that influence the poverty gap index are the dependency ratio, while the open unemployment rate, crime rate and sex ratio do not affect the poverty gap index.

Measuring the Effect of Inequality and Human Resource Indicators to Poverty Density in Indonesia

The density of the poor occurs because rapid population growth that is not followed by fast economic growth, resulting in a density of poor people in Indonesia. This study aims to analyze the effect of the Poverty gap index-P1, HDI, GRDP, Labor Force on the Density of the Poor in Indonesia in 2015-2020. This study uses the Poverty gap index-P1 to fill the gap of research. All data obtained from the Central Bureau of Statistics (BPS) of the Republic of Indonesia. The data obtained are in the form of time series and cross-section data in 2015-2020. The analysis technique used is panel data regression. Result of the discussion the poverty gap index-P1 have positive impact to the poverty density indicated by the level of size and the depth of the poor population that increases, and the HDI have negative impact to poverty density. The suggestion from the study is poverty alleviation programs needs to be strengthened and expanding the access of health and employment facilities to the poor is of major importance.

Financial Development, Income Inequality and Poverty Alleviation: Some Empirical Evidence

This study examines the relationship between financial development, income inequality and poverty reduction in a sample of 48 Sub-Saharan African (SSA) countries, observed during the 1980-2017 period. The results indicate that financial development, when proxied by private sector credit and liquid liabilities, reduces poverty. The results are mixed for the Claims on domestic real nonfinancial sector by the Central Bank. On the other hand, the results of the direct and cross-estimates showed a positive and significant effect of income inequality on poverty. We conclude that income inequality is such large that a larger proportion of the population is impoverished and the poverty gap is widening further. Moreover, income inequality seems to slow down the positive effects of financial development on poverty reduction. The findings allow us to recommend that monetary and public authorities in SSA countries support the development of the financial sector, particularly banks, encourage financial institutions to channel financial resources to the poor but with income-generating initiatives and enforce laws to control income inequality.

A Multidimensional Approach to the Gender Gap in Poverty: An Application for Turkey

Conventional poverty measures have long been criticized as a poor gauge of quality of life. Household-level income or expenditure data used in these measures are silent on intrahousehold inequalities and capture means to an end rather than outcomes and opportunities individuals face. This article constructs a multidimensional poverty index (MPI) to address these problems. It calculates multidimensional poverty for Turkey in four equally weighted dimensions: education, health, employment, and household living conditions. The study introduces employment as a distinct dimension of well-being, which is especially pertinent for the gender gap in poverty in the Turkish context. It finds a significant (30–34 percent) gender poverty gap, which is gradually narrowing over time. However, there is very little convergence between regions. Finally, results show households with multidimensionally poor women and non-poor men as the most common sub-group and an increase in the share of households with no poor members. HIGHLIGHTS The study evaluates the multidimensional poverty of individuals to analyze gender gaps. Employment proxies for ignored functionings like self-respect and social inclusion. Gender poverty gap was between 30 and 34 percent during 2006–15. Gender poverty gap is only closing for the youngest cohorts. Within-household poverty disparities are high and stable during 2006–15.

Innovation Orientation in the Non-profit Sector: Analysis of Its Impact on the Performance of Spanish Non-governmental Development Organizations.

Since 2015, the approval of the 2030 Agenda and of the 17 Sustainable Development Goals (SDGs) has led to a notable reshaping and expansion of the architecture of the international cooperation system. The SDGs mark a new path for the planning processes of the different actors working for development, expanding their goals, proposing an update of the roles they must play, and defining new frameworks for relationships and spaces for action. Non-governmental development organizations (NGDOs), whose traditional mission focused on reducing the poverty gap, defending human rights, or promoting environmental protection, must be able to respond satisfactorily to these new challenges, pass beyond their classic positions, and adapt to an increasingly complex and turbulent global context. Achieving high impact in the SDGs requires development organizations to be more agile and innovative. With the intention of bringing visibility to the importance that innovation can play in the success and results achieved by development cooperation organizations, the main objective of this study was to validate, through a sample of Spanish NGDOs, a causal model that represents the positive contribution which innovation orientation generates in the result of the activity of these entities. This research concludes by confirming that innovation orientation favors the attainment of a higher degree of success in the projects and actions carried out by non-profit entities which promote the SDGs, which has a direct and positive impact on the performance they achieve.

Poverty, Inequality, and the International Monetary Fund: How Austerity Hurts the Poor and Widens Inequality

Abstract Among the drivers of socio-economic development, this article focuses on an important yet insufficiently understood international-level determinant: the spread of austerity policies to the developing world by the International Monetary Fund (IMF). In offering loans to developing countries in exchange for policy reforms, the IMF typically sets the fiscal parameters within which development occurs. Using an original dataset of IMF-mandated austerity targets, we examine how policy reforms prescribed in IMF programs affect inequality and poverty. Our empirical analyses span a panel of up to 79 countries for the period 2002–2018. Using instrumentation techniques, we control for the possibility that these relationships are driven by the IMF imposing harsher austerity measures precisely in countries with more problematic economies. Our findings show that stricter austerity is associated with greater income inequality for up to two years, and that this effect is driven by concentrating income to the top 10% of earners while all other deciles lose out. We also find that stricter austerity is associated with higher poverty headcounts and poverty gaps. Taken together, our findings suggest that the IMF neglects the multiple ways its own policy advice contributed to social inequity in the developing world.

The dark side of energy poverty: Who is underconsuming in Spain and why?

The traditional energy poverty ‘objective’ metrics are mostly focused on households spending a disproportionate share of income on energy. Nevertheless, vulnerable people could also restrict their energy consumption and this ‘hidden energy poverty’ is not sufficiently considered in metrics and policies.This paper investigates this phenomenon and proposes a new methodology to determine an absolute threshold below which households’ actual energy expenditures are too low to meet their required energy needs. Thereafter, an income criterion is introduced as a proxy to exclude households that have low energy expenditures for reasons other than lack of affordability. Finally, this article analyses the sensitivity of results to the assumptions made for the absolute energy expenditure threshold and the income threshold, thus presenting an alternative ‘adjusted to reality’ scenario.The results for the Spanish case study show that, in 2019, 45% of households had low absolute energy expenditures, but only 56% of these (25% of the total households) were suffering from hidden energy poverty. Besides, the average annual ‘energy poverty gap’ per household was €374, and the national budget needed to potentially fill this gap was €1,692 m. Moreover, there was a broad regional disparity depending on climatology and income, and several key factors have been identified, i.e. household size, housing’s energy efficiency and tenure, and locality’s degree of urbanisation.Thus, the macro-level analysis carried out in this paper makes it possible to characterise hidden energy poverty in Spain, and the policy recommendations provided might guide policymakers to target assistance programs more effectively.

Impact of policies, strategies and agricultural institutions on food security and poverty status of vegetable farmers along the blue nile banks, Gezira State, Sudan (2017)

Having clear picture on food security status and its major determinants helps policy makers and planners to introduce new policies that enhance food security. The study was aimed to evaluate the impact of policies, strategies and institution on food security and poverty status of the vegetables farmers in Gezira State with reference to the Blue Nile farmers. To achieve these objectives stratified random sampling technique was used to select the respondents from five localities lays along Blue Nile, so 150 farming households were interviewed. Food security Policy and strategy were collected by the mean of questionnaire targeting key line institutions. Poverty indices were calculated using expenditure as welfare indicator,Gini coefficient was applied. The results showed that the majority 75% of the respondents were above expenditure poverty line (7196)SDG. Moreover, the results showed that the poverty gap index was equal to five percent. Kamlin, Medani, East Gezira reported the higher expenditure distance from the poverty line (6 percent). The severity of poverty in the state is estimated to be two percent, likewise the severity of poverty in East Gezira was found to have a higher percentage (three percent). According to Gini coefficient the income distribution estimated at 0.46 while that for expenditure distribution is estimated at 0.31, these results showed a higher degree of inequality. The results showed that the poorest 20% of the population earned 0.06% of the total income while the richest 20% earned 45% of the total income. About 50.7% from the respondents use borrowing from others as one of their coping strategies. About 78%of policy makers said that there was organized team from all institutions dealing with food security and nutrition issue, all policy makers in the state said there was strategy concerning the food security and nutrition issues. The study recommended that the cash transfer needed to lift the poor out of poverty that each poor person needs five percent of the value of the poverty line.

Catastrophic health expenditure and impoverishment in Vietnam: Evidence from national Household Living Standards Surveys 2008–2018

One of the strategic objectives of the Vietnamese government in achieving universal health coverage (UHC) is to develop a sustainable, equitable, and effective health financing system. This study aimed to examine the incidence and intensity of catastrophic health expenditure (CHE) and impoverishment in Vietnam at different thresholds of expenditure. The data were obtained from six national representative Household Living Standards Surveys from 2008 to 2018. We found that the incidence and intensity of CHE declined significantly over study years. Additionally, we found a substantial reduction in the incidence and intensity of medical impoverishment in Vietnam. The increase in the poverty gap in 2012 and 2014 was because non-poor households became poor after out-of-pocket (OOP) health payments. However, the rise in poverty gaps in 2008, 2010, 2016 and 2018 was attributable to the worsening state of existing poor households after healthcare payments. In addition, we found that the CHE rate and impoverishment were more concentrated in the poor quintile groups. Furthermore, we found that the Red River Delta had the highest CHE rate, whereas the Northern Midland region experienced the strongest poverty impact of OOP payments. Generally, in Vietnam, the health financing system has had no considerable success in reducing inequality across quintiles and regions. Finally, our findings revealed that health insurance showed positive impacts on households’ financial protection against CHE and impoverishment, after enacting both the first Health Insurance Law in 2009 and the Revised Health Insurance Law in 2015. The results suggest that the health insurance scheme should be reviewed to continue reducing CHE and impoverishment, promoting equity and enhancing the performance of the health financing system in Vietnam.