Abstract:
Appropriate poverty measurement and identification of consumption-based rural poverty
determinants are the key steps to formulate appropriate poverty reduction strategies. Several
poverty measures were done by different methods at different locations. To overcome
consumption-based poverty problem area specific research data is pertinent. So this research
was conducted at west Belesa woreda, Central Gondar zone of Ethiopia in 2019. The
objective of this research is to analyze the extent of rural poverty and identify the
determinants of consumption-based rural poverty at the household level. To collect the data,
194 households were selected at 4 representative kebeles by simple random sampling
technique. The Primary data were collected from the respondent by schedule interview and
focus group discussion. The secondary data were collected from reports, journals,
proceedings, and books. The collected data were analyzed using descriptive statistics
(percentage, mean, minimum and maximum) and inferential statistics such as t-test, chisquare test, binary logit, Principal Component Analysis (PCA) and poverty indices. To
measure the extent of rural poverty, asset-based and consumption-based poverty
measurement approaches were applied. The calculated asset poverty line generated by
Principal Component Analysis method was 0.75 while the food and non-food consumption
poverty line calculated by the cost of basic need approach were 2949.40 birr per AE per year
and 1485.78 birr per year per AE respectively. The rural poverty indices were calculated on
the consumption-based poverty line. Headcount index, Poverty gap, and severity of poverty
were 38.1 percent 8.84 percent and 3.1 percent respectively with the inequality Gini
coefficient of 0.26. A binary logit analysis result shows that family size had a significant and
positive relationship on consumption-based rural poverty but landholding size, tropical
livestock unit, amount of off-farm income and distance of agricultural office had a significant
and negative relationship on consumption-based rural poverty. Consumption-based poverty is
deep and complex in the study area. 38.1 percent of the rural people live in consumptionbased poverty. To reduce asset-based and consumption-based rural poverty in the woreda,
multidimensional poverty reduction strategy should be launch. Awareness creation and
income generation activities should expand at the community as well as the household level.
Keywords: Asset, Consumption, Expenditure, Logit, Rural poverty, Ethiopia
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