Assessing Vulnerability to Poverty in Wolaita and Dawuro Zones, Ethiopia

BSTRACT A households observed poverty level is an ex-post measure of a households well-being. But poverty is a stochastic phenomenon implying that the current poverty level of a household may not necessarily be a good guide to the households expected poverty in the future. Hence, in thinking about ex ante poverty prevention interventions, the critical need then is to go beyond a classifying of who is currently poor and who is not, to an assessment of households vulnerability to poverty. Therefore, this study is primarily intended to examine the extent of poverty and vulnerability in Wolaita and Dawuro zones, in which existing studies neglected it. The data for this research is mainly based on the cross sectional primary data collected from 165 households selected from the two zones using two stage sampling. We use the Foster-Greer-Thorbecke (FGT) poverty measures in order to measure the ex post poverty and we make use of the Chaudhuri (2003) vulnerability measures that uses a three step Feasible Generalized Least Squares (3FGLS) to estimate ex ante poverty. Despite the substantial efforts to reduce poverty over all the country, our study found that considerable proportion of households are found poor (56 %) and vulnerable (62 %) in both zones but both measures of poverty have been found to vary between different population segments. Moreover, the fraction of the population that faces risk of poverty is considerably greater than the fraction that is observed to be poor implying considerable proportion of currently non poor (62 %) will face risk of poverty. And our study shows that majority of the household vulnerability to poverty is sourced from the low endowments of households residing in the two zones.