Key findings

  • Household wealth has improved over the five rounds of Young Lives surveys from 2002 to 2016 as measured by the wealth index. Despite differences in wealth especially based on location persisting, the greater increase in rural sites and among the poorest suggests possible economic convergence.
  • The reduction in three measures – absolute poverty, the poverty gap and the severity of poverty – suggests an overall improvement and a decline in inequality, with more upward mobility in urban sites. Nonetheless, earlier poverty status is predictive of later status, suggesting a strong persistence of poverty.
  • Multidimensional poverty analysis also reveals a consistent decline over the rounds, confirming more general improvements in wellbeing. The biggest gains were in health, education, and access to safe water and sanitation, with lesser improvements in the information dimension and fluctuations in the shelter dimension.
  • In considering degrees of poverty, we find greater proportions of poor people in rural areas, and greater proportions of non-poor people in urban areas. However, we see an overall shift of severely poor people to moderately poor people, and from the latter to non-poor people with some location and cohort differences.
  • The most important factors that are associated with poverty were found to be the following: larger numbers of household dependents and children under 18; lower education level of household members; and socio-economic shocks such as illness of a household member, loss of employment, or livestock deaths.
  • Factors reducing the likelihood of poverty included: the presence of women working outside the home; access to credit and irrigated land; and living in urban areas within households headed by men. Boys in urban sites were less likely to face chronic poverty than girls.

Policy messages

  • Despite important reductions in poverty and inequality, persisting differences by location and wealth status suggests the need to continue to prioritise pro-poor policies.
  • Although the study shows some convergence between the rural and urban areas, and between the poor and the non-poor, the disparities have continued to persist over time, so that continued emphasis on expanding services to rural and more remote areas is important in order to reduce inequalities.
  • The greater probability of families with more dependents and children facing transient or chronic poverty implies the need for continued attention to promoting family planning.
  • The fact that the presence of working females within the households reduces the likelihood of households experiencing poverty suggests the need to promote female employment.
  • The lesser probability of households with a better average education level facing poverty suggests that the high government expenditure on education is justified and should continue to be focused on areas with less access to education.
  • The fact that socio-economic shocks such as loss of employment and death of livestock are associated with a greater likelihood of households facing poverty suggests the need to strengthen the implementation of the Social Protection and Disaster Risk Management policies.
  • The strong association of illness in the household with the likelihood of experiencing poverty calls for the expansion of health insurance schemes to protect vulnerable households and children.
  • In urban areas the greater likelihood of women heading households and girls facing chronic poverty suggests that further support should be targeted to single women and girls.