Poverty, inequality and Growth in Urban Ethiopia
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Date
2001-07
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A.A.U
Abstract
This paper compares and analyses the spread, depth and severity of urban poverty and it’s relative
Sensitivity to changes in growth and inequality across individual urban units and over time. The Urban
Socio-Economic Survey Data conducted by the Department of Economics of AAU and Department of
Economics of Goteberg University of Sweden across seven urban centers in four rounds ( 1994, 1995,
1997 and 2000) have been used.
Recent techinigues for poverty analysis have been applied. The three decomposable poverty measures
along with Gini indices have been estimated for individual urban centers over four study periods.
Decomposition techniques of poverty, intended to examine different aspects of it, have extensively been
applied. Decomposition of aggregate urban poverty into population weighted share of the sub-groups,
allowed to investigate the relative contribution of each urban centre to the aggregate poverty. The
elasticity of aggregate poverty to changes in growth or redistribution in 1 th urban centre and analysis of
targeting have been employed to priorities urban centers for efficient al location of scare resources and
hence maximum reduction in aggregate poverty. Decomposition of poverty at a given point in time into
growth and distribution components has also been used to explore the relative sensitivity of poverty to
growth and inequality. The observed change in poverty between two periods has also been decomposed
into growth, redistribution and residual effects to examine the relative importance of growth or
Redistribution as a policy alternative to address the issue of poverty. Using poverty measures as
Dependent variables against growth and inequality as explanatory variables, the regression analysis of
Panel data have well been discussed to determine the relative elasticity of poverty with respect to growth
and inequality.
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Keywords
Growth in Urban Ethiopia, Poverty, inequality