Analysis Of Poverty And Income Inequality In Urban Areas: A Case Study In Jimma Rare Wored

Abstract

The objective of this study is to analyze poverty and income inequality and it‟s determinants in Jimma Rare Woreda Town. Primary data was collected a total of 362 household heads, from three kebelles, were selected to undertake the research and a proportionate stratified sampling technique was employed and from each kebele‟s registry-frame, households were selected using systematic random sampling. A logistic regression model was employed to determine the factors influencing poverty in Jimma Rare, with the probability of a household being poor used as a dependent variable and a set of demographic and socioeconomic variables as the explanatory variables. By making use of Cost of Basic Needs (CBN) approach, birr 3021 was computed as total poverty line per adult equivalent per month and, based on this bench mark, households were identified as poor and non-poor. Based on this, there was a poverty incidence of 63.2 percent with income short fall of 32.1 percent and poverty severity index of 11.9 percent. Income inequality, as measured by Gini coefficient in Jimma Rare Woreda Town was 0.36 and kebeles wise with high inequality Wayu (0.38) followed by Hunde Jiregna Babala (0.37) and 0.36 was observed by Goban. Due to the prevalence of poverty and income disparity, immediate action is required to address the issues facing the populace. This action should focus on providing social services, empowering women, providing market-based short-term training, and providing job possibilitie