Determinants of Poverty Depth among Households in
Rural and Urban Nigeria
Awopeju Samson O. (Corvinus University&UniBonn/ Regional Support Consultant UNCCD)
Prof. Imre Ferto (Corvinus University, Budapest, Hungary)
Presentation at the EADI 14th GENERAL CONFERENCE, JUNE, BONN, 2014.
OUTLINE
Introduction
Objective.
Methodology-study
area, data sources, analytical
methods.
Results
and Discussions
Conclusions
EADI-GC2014, 16 March, 2016
2
INTRODUCTION

An estimated 1.2 billion people are still living below $1.25 a day in developing
countries- (World-Bank press release 2013).

Sub Saharan Africa as a continent has a tragic record of highest incidence of poverty ,
currently at 48 percent of its population. In 1991 poverty was 58 percent. (World-Bank
press release 2013).
Some Good News

The number of people living on less than $1.25 per day has declined dramatically in
the past three decades.

From half the citizens in the developing world in 1981 to 21 percent in 2010 despite a
59 percent increase in the developing world population. (World-Bank press release
2013).
EADI-GC2014, 16 March, 2016
3
BUT???

Not every developing nations has witnessed steady decrease in poverty. NIGERIA is a
good example.
PARADOX !
 A nation blessed with
major economic
resources that drive
global economy
Petroleum, tin,
columbite, iron ore,
coal, limestone, lead,
zinc, natural gas and
forests and good
Agricultural lands).
 Currently largest
economy in Africa
Source: Nigeria's National Bureau of Statistics
EADI-GC2014, 16 March, 2016
4
OBJECTIVE
Central focus : examine the determinants of poverty status among households in
Nigeria both at the national and sectorial level employing household socioeconomic and regional characteristics.
Specifically the study:
 Estimated incidences, depth and severity of poverty among Nigerians at the
national, rural and urban regions.
 Assessed the determinants of poverty depth among households in Nigeria at
the national level.
 Examined the determinants of poverty depth among households in Nigeria at
both the rural and urban sectors
EADI-GC2014, 16 March, 2016
5
Motivation for the study
 National Burea of statistics NBS (Nigeria) utilized National Consumption
Expenditure survey data 2009/2010 --------to estimate poverty incidence for
Nigeria but did not capture depth, severity and determinants of poverty.
 This study is an attempt to fill that gap, by estimating the depth, severity and
determinants of poverty at the rural, urban and national level.
Data : 2009/2010 Consumption Expenditure Survey (38,700 households) from
National Bureau of Statistics NBS, Nigeria.
Limitation
 At the time study was conducted there was no access to Harmonized
National Living Standard Survey (HNLSS) which includes other welfare
variables like education status, assets of households, access to credits e.t.c
 The study employed relative poverty line though absolute poverty line is
considered better and more objective.
EADI-GC2014, 16 March, 2016
6
ANALYTICAL TECHNIQUE
EADI-GC2014, 16 March, 2016
7
ANALYTICAL TECHNIQUE
EADI-GC2014, 16 March, 2016
8
RESULTS AND DISCUSSIONS
Source: own computation based on National Consumption Expenditure Data 2009/2010
EADI-GC2014, 16 March, 2016
9
RESULTS AND DISCUSSIONS
Source: own computation based on National Consumption Expenditure Data 2009/2010
EADI-GC2014, 16 March, 2016
10
Determinants of Poverty Depth in Nigeria
Variables
Household Size
Coefficients
0.0912512
t-ratio
84.27** *
Gender(Male)
-0.037855
-3.78* *
Age of household head
0.0046764
5.36** *
-3.57e-8
-9.31** *
Marital Status
0.0105012
1.03
North -Central
-0.1051182
-13.23 ** *
South -East
-0.1361191
-15.50** *
South -South
-0.0693516
-8.26** *
South West
-0.047192
-5.32** *
Sector (Rural)
0.2017716
32.52
Total Remittances Received
Log Likelihood = -16105.212 , Pseudo R2 = 0.2763, Prob > Chi2 = 0.0000
Notes: ***t-ratio Significant at 1% level, ** significant at 5% level
EADI-GC2014, 16 March, 2016
11
Determinants of Poverty Depth in Rural Nigeria
Variables
Household Size
Coefficients
0.0896476
t-ratio
77.54** *
Gender(Male)
-0.0244319
-2.15* *
Age of household head
0.0060493
6.40** *
-0.0000000291
-6.65** *
Marital Status
0.0156136
1.38
North -Central
-0.1048941
-12.73 ** *
South -East
-0.1367113
-14.82** *
South -South
-0.0628685
-7.18** *
South West
-0.0375136
-3.49** *
Total Remittances Received
Log Likelihood = -12242.307 , Pseudo R2 = 0.2663, Prob > Chi2 = 0.0000
Notes: ***t-ratio Significant at 1% level, ** significant at 5% level
EADI-GC2014, 16 March, 2016
12
Determinants of Poverty Depth in Urban Nigeria
Variables
Coefficients
Household Size
0.1023838
33.61***
Gender
-0.0724538
-3.24***
-5.57E-08
-6.50***
Age of household head
-0.0005749
-0.25
Marital Status
-0.0130128
-0.54
North -Central
-0.1252555
-4.63***
North -West
-0.1314371
-5.04***
South -East
-0.1331358
-4.68***
South -South
-0.1167776
-4.16***
South West
-0.0996916
-4.17***
Total Remittances Received
t-ratio
Log Likelihood = -3766.883, Pseudo R2 = 0.1979 , Prob > Chi2 = 0.0000
Notes: ***t-ratio Significant at 1% level
EADI-GC2014, 16 March, 2016
13
CONCLUSIONS
 Study found out that male headed households were better off than their
female counterparts in reducing poverty status.
 Poverty is more predominant in rural Nigeria and living in rural areas
aggravates the poverty situation of households.
 Northern Nigeria is poorer than Southern Nigeria.
 Larger household size had a positive and significant impact on poverty
status of households.
 Remittances received by households had a negative and significant effect on
poverty status of households although the impact is weak.
*Further study is required to include other important variables
EADI-GC2014, 16 March, 2016
14
Thank you
for your attention!
EADI-GC2014, 16 March, 2016
15