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Multidimensional Poverty among Households in Southwest Nigeria

Article in Journal of Economics and Development · April 2018

DOI: 10.33301/JED-P-2018-20-01-03

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Journal of Economics and Development, Vol.20, No.1, April 2018, pp. 48-67 ISSN 1859 0020

Multidimensional Poverty among

Households in Southwest Nigeria
Sakiru Oladele Akinbode
Department of Economics, Federal University of Agriculture, Abeokuta, Nigeria
Email: deleakinbode@[Link]

Folake Elizabeth Ojediran

Department of Economics, Federal University of Agriculture, Abeokuta, Nigeria
Email: pholakemyoje@[Link]

Received: 29 January 2017 | Revised: 19 December 2017 | Accepted: 13 Febuary 2018

Abstract
Money metrics have been adopted in studies of household poverty in Nigeria while few have
considered alternative methods. This study analysed poverty among households in southwest
Nigeria adopting a “Multidimensional Approach”. This is necessary for robust and effective
policy. Data were collected from 355 randomly selected households. Alkire-Foster’s methodology
was used to assess households’ poverty and this was further decomposed. The majority of the
households lacked improved toilet facilities, sanitation, improved drinking water, nearness to
healthcare centres and primary schools, while most households engaged in self-medication.
About 7.9 percent were deprived in all the eleven indicators considered. The Multidimensional
Headcount Ratio (H) when cut-off (k) was set at 1/3 revealed that 69% of the households were
poor and its Intensity (A) was 65% while the Multidimensional Poverty Index (MPI), which is the
Adjusted Head Count Ratio (M0) revealed that an average household in the area was deprived
of 45% of the total potential deprivations it could experience. Decomposition by socioeconomic
characteristics revealed that the poverty rate was higher among female-headed households.
The same applied to households headed by divorced individuals, younger persons, farmers, less
educated individuals and larger households. When k=2/3, 44.2 percent of the households were
classified as poor with an “A” value of 0.416 and the MPI being 0.184. At k=1 the percentage of
poor households reduced significantly to 7.9 percent with an intensity value of 0.074 and MPI of
0.006. It is recommended that government should improve access to education, health care and
enforce various sanitation laws to improve households’ hygiene. Policies should also be geared
towards empowering households in order to escape poverty.
Keywords: Poverty; deprivation; households; multidimensional approach; Nigeria.
JED code: I32, O12.

Journal of Economics and Development 48 Vol. 20, No.1, April 2018

 1. Introduction poverty from the point of view of effective de-
Poverty has been a widely discussed topic by mands, needs and wants while the psychologist
governments and development agencies around may want to look at it from the standpoint of
the world. Poverty reduction is a major goal deprivation, esteem and ego. From whatever
and issue for many international organizations perspective poverty is viewed, it is obvious that
such as the World Bank, the United Nations, poverty is a condition of life that is extremely
UNICEF and UNESCO among several others. degrading and likely to insult the dignity of the
Various studies have been conducted on pov- people being afflicted.
erty by researchers adopting different views or Poverty is a worldwide phenomenon that af-
definitions and methodologies as well. Most fects continents, nations and peoples different-
of the research works on poverty are aimed at ly. It afflicts people in various depths, levels of
understanding the static and dynamic nature of seriousness and at different times and phases of
poverty and to possibly proffer solutions. Rel- their existence. There is no country that is abso-
evant literature shows that there is no general lutely free from poverty. The major difference
consensus on any meaningful definition of pov- is in its intensity and prevalence. According to
erty, that is, there is no concise way of defining USAID (2013), the vast majority of those in ex-
the concept of poverty, as it is a multi-dimen- treme poverty reside in South Asia, Sub-Saha-
sional phenomenon that affects many aspects ran Africa, The West Indies, East Asia and the
of the human condition, ranging from physi- Pacific while nearly half live in India and Chi-
cal to moral, to psychological and to political na alone. Nations in sub-Saharan Africa, South
(Ogwumike, 2002). However, poverty may be Asia and Latin America have the highest level
viewed as the general dearth, scarcity or the of poverty and consequently have the lowest
state of someone who lacks a certain amount of level of socio-economic development. They
material possessions, money or social capital. also have the highest level of social insecuri-
It has been treated as a multifaceted concept, ty which may be due to joblessness, violence,
which includes social, economic and political unrest and a generally unacceptable low stan-
elements. dard of living coupled with a low level of the
Furthermore, poverty may be described as social safety net (Oyebola, 2003). According to
the lack of many resources, which possibly the World Bank (2015), 702.1 million people
leads to physical deprivation and hunger. It lived in extreme poverty around the world in
includes lack of voice, power, and indepen- 2015. This represented a noticeable reduction
dence that subjects those afflicted to exploita- compared with 1.75 billion in 1990. Out of the
tion. Poverty among the people exposes them 702.1 million, about 347.1 million people were
to rudeness, inhumane treatment and humilia- said to be living in Sub-Saharan Africa (which
tion by the private and the public agents of the represented 35.2 percent of the population)
state from whom they usually seek help. Many and 231.3 million lived in South Asia (about
criteria have been used to perceive poverty. 13.5 percent of the population). It was reported
An economist would approach the subject of that from 1990 to 2015, the proportion of the

Journal of Economics and Development 49 Vol. 20, No.1, April 2018

world’s population living in extreme poverty It is however worthy of note that the HDI fig-
fell from 37.1 percent to 9.6 percent, falling be- ures should not be compared with those of
low 10 percent for the first time in history. This previous reports due to the changing structural
may be due to the direct and indirect benefits background.
of the United Nations’ Millennium Develop- Poverty reduction is undoubtedly one of the
ment Goals (MDGs) which ended in December highest-ranking items in the national develop-
2015. ment strategies in Nigeria and the most potent
According to the World Bank (2013), about issue in the current international development
90 percent of maternal deaths which occur agenda. This is reflected in the Millennium De-
during childbirth happen in Asia and sub-Sa- velopment Goal (MDG) whose target was to
haran Africa. This is quite high if compared reduce the number of people living in poverty
with the less than 1 percent that occurs in the by half by December 2015. This important goal
developed world. Poor people have also been is also the first in the newly launched Sustain-
shown to have a far greater tendency of having able Development Goals (SDGs) of the United
or incurring a disability in their lifetime (Glob- Nations whose aim is “to eradicate poverty in
al Policy, 2003) all its forms everywhere by 2030”. The vision
Nigerian governments have at various times statements of most bi-lateral and multilateral
embarked on programmes aimed at reducing donor agencies are related to poverty reduc-
the incidence of poverty in the country. The tion. The policy papers of most developing
Nigerian poverty rate increased from 27.2 per- countries, for instance, the Nigeria National
cent in 1980 to 46.3 percent in 1985 and 65.6 Economic Empowerment and Development
percent in 1996 (National Bureau of Statistics Strategy (NEEDS), are directly linked to pov-
NBS, 1996). There was a drop in the poverty erty reduction.
rate to 54.4% in 2004 (Nigeria Bureau of Sta- Most of the poverty figures are purely mon-
tistics NBS, 2004). As at 2013, the World Bank ey-metric. The money-metric measure of pov-
reported that the country’s poverty rate was erty has achieved tremendous progress over
33 percent. Furthermore, the poverty report the decades, but the well-being of a popula-
released by the Human Development Report tion, and hence, its poverty, which is a man-
showed Nigeria’s Human Development Index ifestation of insufficient well-being, depends
(HDI) value for 2012 was 0.47, positioning the on both monetary and non-monetary variables.
country at 153 out of 187 countries and terri- The Human Development Report published by
tories. The country’s HDI value for 2014 was the UNDP (2006) stated that a lack of income
0.514, which placed Nigeria in the low hu- only provides part of the picture in terms of the
man development level and at 152 out of 188 many factors that impact on an individuals’ lev-
countries. Between 2005 and 2014, Nigeria’s el of welfare e.g. longevity, good health, good
HDI value increased from 0.467 to 0.514, an nutrition, education, etc. Therefore, a more
increase of 10.1 percent or an average annual comprehensive measurement is required. The
increase of about 1.07 percent (UNDP, 2015). technical difficulties of income measurement,

Journal of Economics and Development 50 Vol. 20, No.1, April 2018

especially in developing countries, have been ences of deprivation which may include poor
an important initiative for looking at other pov- health, lack of education and inadequate living
erty measures which will be more effective to standard. In the light of the foregoing, there
eradicate poverty in the country. is an urgent need to evolve a study aimed at
It is common knowledge that, in Nigeria, assessing poverty in Nigeria using the multidi-
different governments have embarked on var- mensional approach. This is expected to give a
ious forms of poverty reduction strategies. For full description of the state of being poor and
example, at independence in 1960, poverty chart a policy direction towards poverty reduc-
eradication efforts in Nigeria centred on edu- tion. To this end, this study sought to describe
cation, while Operation Feed the Nation (OFN) the nature of deprivation among the sampled
was launched in 1978. Others are The Green households, to compute the multidimensional
Revolution in 1980, People’s Bank and Com- poverty index of the households with varied
munity Banks (now Microfinance Bank) — cut-off, to decompose according to household
whose main targets were/are to mobilize idle socioeconomic characteristics and other rele-
funds and to aid capital formation and invest- vant criteria and to draw meaningful conclu-
ment especially in the informal sector and ru- sion and make useful recommendations.
ral areas—the Family Economic Advancement 2. The concept of poverty
Programme (FEAP) in 1995, the National Eco- The choice of a definition of poverty will de-
nomic Empowerment and Development Pro- termine to some extent the number of people
gramme NEEDS in 2003, the National Poverty classified as poor and the rate at which poverty
Eradication Programme (NAPEP), the Seven is perceived as being eliminated or alleviated.
Point Agenda in 2007 and the Transformation If the absolute standard is chosen, rising real
Agenda in 2011etc. There have been several living standards will push more people or fami-
interventions by groups such as NGOs, Minis- lies above the poverty line. It is only equalizing
tries, Departments and Agencies among others the distribution of income that can eradicate
which may not be formally documented. poverty under the relative measure of poverty.
There is a dire need to assess and measure According to Agola and Awange (2014), the
poverty in a way that will be effective in erad- diversity of meanings attached to poverty ren-
icating it. There are permanent challenges of ders conceptualization of poverty and its oper-
measuring poverty due to the lack of general ational meaning and measurement difficult and
consensus on the definition of poverty. An in- intractable.
come approach and an assets index approach, Absolute poverty
among others, have been used to assess pov- Absolute poverty, destitution or extreme
erty; yet, most of them give no true, consistent poverty according to the United Nations (1995)
and concise definition of poverty. A multidi- is a condition where there is severe deprivation
mensional poverty measure provides an answer of basic human needs such as food, sanitation
to frequently asked questions on poverty mea- facilities, safe drinking water, health, shelter,
sures since it constitutes several poor experi- education and information. Furthermore, it de-

Journal of Economics and Development 51 Vol. 20, No.1, April 2018

pends not only on income but also on access to majority of the population, as poor. This level
services. Extreme poverty commonly refers to of deprivation is considerably out of line with
earnings that are below the international pover- the general living standards enjoyed by the
ty line of $1.25/day per person (in 2005 prices). majority of the people in such a society. It is a
Meanwhile, in October 2015, the new poverty measurement of the resources and living con-
threshold was reset to $1.90 a day after an ex- ditions of parts of the population in relation to
tensive review of costs of living in a number of the economic status of other members of the
countries. Absolute poverty is one of the con- society. Relative poverty considers an individ-
cepts of poverty used in different ways to rep- ual’s economic and social status relative to the
resent a poverty level which does not change rest of society. If people’s income and resourc-
over time, in terms of the living standard that es they possess are so insufficient to the extent
it refers to. It stays the same even if society is that it prevents them from having a standard of
becoming more prosperous. Thus, the concept living considered acceptable within the society
of absolute poverty is understood as the mini- they live, they are said to be living in relative
mum set of resources a person needs to survive poverty. Smith (1776) made it clear that “ne-
or to maintain a minimum standard of living. cessities” were determined by “custom” and
Absolute poverty relates to the inability of the hence that poverty was relative. De Montauge
individual to provide for him/herself the basic (1997) asserted that “poverty is measured by
needs like food, shelter, clothing, potable wa- comparisons.
ter, education, health services, public transport 3. Theoretical literature relating to pover-
etc. This type of poverty leads to deprivation. ty
It is the line below which existence becomes a Economic development has traditionally
matter of acute deprivation, hunger, suffering focused on the gap between the rich and the
and premature death. Absolute poverty needs poor countries and on ways that the process of
immediate corrective actions by the govern- growth, especially in poor countries, could be
ment or those who it may concern to make ap- accelerated, with little or no attention given to
propriate policies to curb its incidence. In the the gap between the rich and the poor people
view of Sen (1983), poverty must be seen to be in both the developed and developing countries
primarily an “absolute notion”. In his words, until recently. This very belated concern about
for instance, “if an individual is starving, he is absolute poverty, relative poverty and income
considered to be poor even if everyone else is distribution has possibly been promoted by
also starving”. However, once one moves away the realization that, even though development
from extreme cases it becomes much more dif- occurs and per capita incomes grow, the num-
ficult to make assertions that are comprehen- bers of poor people also increases (Agola and
sively convincing. Awange, 2014).
Relative poverty The neoclassical paradigm recognized that
A relative concept of poverty considers income inequality is necessary for growth and
those who are excessively worse off than the efficiency. The neoclassical belief is that if the

Journal of Economics and Development 52 Vol. 20, No.1, April 2018

rate of growth in GNP is taken care of, pover- productivity. But the radical theory also postu-
ty would be taken care of. Contrastingly, eco- lates that the class division in society and the
nomic development reality clearly defies this relative distribution among classes will affect
theoretical framework. Keynesian economics the distribution of individual income as well.
posited that the use of taxes and subsidies for An individual’s class will, ultimately, affect
redistributing income would reduce or even both his productivity, through the allocation
eliminate poverty. The neoclassical approach of social resources to invest in the workers of
neglected the fact that differences in person- his class and through the differential access of
al incomes seem too large to be explained by different classes to different kinds of comple-
differences in factor endowments alone among mentary capital, and his relative share of final
several other issues. product’ (Gordon, 1972).
Looking at poverty from the Dual Labour The Functional theory of poverty posited
Market theory perspective, which is a clear that in all societies there are different social po-
departure from the neoclassical orthodox as- sitions or statuses which vary in pleasantness,
sumptions, there exists a ‘primary’ sector in difficulty and functions to the society. Specif-
which employment was stable, where pay was ic returns have to be associated with them in
good and where there were strong trade unions. order to guarantee that all positions are filled.
There is also a ‘secondary’ sector where em- Therefore, inequality is necessary so that the
ployment was unstable and pay was low while positions are filled. According to Gans (1972)
at the same time the prospects of promotion who looked at poverty from a sociological and
was poor and unions had very little stake or partly economic point of view, society has ob-
influence. Under this theory much emphasis sessed itself with the costs of poverty to the ex-
was placed on the disadvantageous character- tent that it fails to appreciate the benefits. The
istics of the secondary labour market just as crux of Gans’ argument is that poverty has roles
it is being placed on the characteristics of the to play in the functioning of a society. These
individuals holding jobs. However, because roles include: poor people being readily avail-
the explanations provided by the Dual Labour able to do all sorts of dangerous, undignified,
Market theory were considered inadequate by dirty and menial jobs; engaging in unprofes-
scholars, new theories have been formulated. sional jobs like drug peddling and prostitution;
The Radical Economic theory of poverty draws purchase of damaged, stale and sub-standard
greatly from the Marxist tradition, but accord- goods thereby prolonging or creating economic
ing to Bosanquet and Doeringer (1973), it has usefulness for those goods; upholding the le-
re-modelled Classical Marxism in response gitimacy of dominant norms; guaranteeing or
to recent social and historical developments’. securing of the status of the non-poor; ensur-
Here, the market price of a product affects the ing viability of non-economic groups such as
value of an individual’s marginal product as fund-raising and philanthropy, among several
in traditional theory. Supply and demand, re- others. Gans concluded that poverty could only
inforced by competition, affect an individual’s be eliminated when it either becomes effective-

Journal of Economics and Development 53 Vol. 20, No.1, April 2018

ly dysfunctional for the rich or when the poor cludes the FGT measure which was developed
can obtain enough power to change the system by Foster et al. (1984). This measure decom-
of social stratification. poses a class of poor people. It takes into ac-
Sen (1992) contended that traditional wel- count the headcount ratio or the incidence of
fare economics, which emphasised the revealed poverty, which is labelled Pα = 0. The depth of
preferences utilities of individuals in their acts poverty is the poverty gap ratio denoted by Pα
of choice, lack enough information about peo- = 1. This gives the proportion of the average
ple’s preferences to assess the social good. As a poor from the poverty line and it can be used
panacea, Sen’s welfare theory relies on individ- to obtain the amount of resources needed by an
uals’ capability, not on individuals’ attainments average poor person to escape poverty, thereby
of basic needs. It was asserted that living con- eliminating absolute poverty. It has been said
sists of a vector of interrelated functioning (be- that the measure is insensitive to redistribution
ings and doings), for instance, being well nour- among the poor. A third measure, given as Pα
ished, avoiding infant mortality, being happy, = 2 gives the severity of poverty and produces
appearing in public without shame etc. Accord- the coefficientof variation of expenditure distri-
ing to Agola and Awange (2014), it is unfortu- bution of the poor, which reflects the degree of
nate that Sen did not assign particular weights inequality among the poor. Meanwhile Agola
to these functionalities, because, “well-being” and Awange (2014) posited that its monetary
is not a clear concept. As far as Sen was con- values were difficult to interpret.
cerned, poverty was not low well-being but the Several poverty measures have been pro-
inability to pursue well-being because of the posed in the literature, which are sensitive to
lack of economic means. This lack may not al- income inequality among the poor. The Sen’s
ways result from a deficiency of capabilities. Measure of Poverty gives the severity of pov-
Therefore, poverty is the failure of basic capa- erty and reduces the co-efficient of variation of
bilities to reach minimally acceptable levels. In expenditure distribution of the poor, which re-
conclusion, most economic theories have not flects the degree of inequality among the poor.
been able to comprehensively and effectively The Sen (1976) measure incorporates the num-
explain the phenomenon of poverty. ber of poor, the poverty-gap and the transfer of
4. Measurements of poverty income from the not so poor to a poorer person
The story of the development of pover- into his measure. Fishlow’s Measure of Poverty
ty measures can be viewed as three historical expresses the poverty gap as a function of the
stages. First, from 1892 and lasting for more income of the non-poor required to eliminate
than half a century was the headcount ratio of poverty. A variant of the FGT measure (Pα) was
poverty measurement spearheaded by Booth given by Ray (1989) and it combines additive
(1892) and made popular by Rowntree (1901). decomposability with poverty aversion. The
According to Agola and Awange (2014) the combination of FGT and Clark et al. (1981)
head count ratio did not tell how far below the criteria is expressed as the Additive Decom-
poverty line the poor are. The second stage in- posability and Aversion Monotonicity Axiom.

Journal of Economics and Development 54 Vol. 20, No.1, April 2018

 It can be deduced that measurement of pov- state consists of 33 Local Government Areas
erty is quite an important exercise as it provides (LGAs). The State covers a land area of 27,249
a metric to measure progress towards poverty square kilometres which is about 42 percent
alleviation/eradication. However, the problem of the landmass of the south-western part of
of arriving at a good measurement method- the country and it is bordered in the north by
ology is very much linked to the problems of Kwara State, in the south by Ogun State, in the
definition of poverty. It is worthy of note that west, by Ogun State and the Republic of Benin,
poverty alleviation approaches tend to put while it is bounded in the East by Osun State.
emphasis on different dimensions of poverty. The state has a population of about 4 million
There is general agreement that money income people (2006, Population Census)
(or consumption) on its own is an imperfect 5.2. Sampling techniques and sample size
measure of welfare. There are different views method of data collection
about the relative importance of non-mone-
A multi-stage sampling technique was used
tary variables. While poverty can be broadly
to select households for the study. The first
defined as an absence of well-being or capaci-
stage involved a random selection of five out
ties, it is multidimensional and manifests itself
of the eleven Local Government Areas (LGAs)
in various forms. This makes the definition of
in Ibadan metropolis. Therefore, Ido, Ibadan
poverty inadequate if only one criterion is used.
North, Ibadan South-East, Lagelu and Akinye-
It should also be recognized that there is no sin-
le LGAs were selected. The second stage in-
gle indicator that can adequately measure all
volved the random selection of ten villages/
dimensions of poverty. This justifies the use of
wards from each of the LGAs. In the third
a multidimensional approach for poverty mea-
stage, eight households were randomly select-
surement.
ed from each ward/village/streets giving a total
5. Methodology of 400 households. The total number of ques-
5.1. Study area tionnaires used for analysis (355) represented
The study was carried out in Oyo state, locat- about 89 percent of the total number of ques-
ed in the South-West geopolitical zone of Nige- tionnaires administered as 45 (representing
ria. The state was one of the three States carved about 11 percent) of the questionnaire were dis-
out of the former Western State of Nigeria in carded due to incompleteness and dominance
1976 by the then Federal Military Government. of visible outliers in the information given. Per-
The choice of Oyo state stemmed from the fact sonal interviews were used to collect data from
that it used to be the regional capital of West- respondents using structured questionnaires
ern Nigeria. By implication, the state consists as an interview guide. Data were collected on
of people from all states in the region and Ni- socio-economic characteristics such as the age
geria at large. The Western region itself drives structure of the households, educational level,
the Nigerian economy as over 60 percent of assets holding, income, occupations, types of
the economic activities in Nigeria take place in house, sources of drinking water, health status,
the South-Western region of the country. Oyo access to healthcare, health seeking behaviour

Journal of Economics and Development 55 Vol. 20, No.1, April 2018

and general living conditions etc. international comparable poverty metric de-
5.3. Method of data analysis signed to measure acute poverty. Acute poverty
refers to people living under conditions where
5.3.1. Descriptive statistics
they do not reach the minimum internationally
Frequency and percentage were used to de-
agreed standards in indicators of basic func-
scribe the socio economic characteristics and
tioning. It measures those experiencing mul-
living conditions of households.
tiple deprivations, people who for example,
5.3.2. The Multidimensional Poverty Index are both undernourished and do not have clean
(MPI) drinking water, adequate sanitation or clean
The Multidimensional Poverty Index is an fuel etc. This study applied Alkire and Foster’s

Table 1: The MPI-dimensions, indicators’ threshold and weights

Dimensions Indicators Deprivation cut-off marks
ଵ if there is no health centre around the
[Link] to health centre ቀ ቁ
ଽ household (within 5 km distance)
ଵ if household does not have food at
Health ଵ
[Link] ቀ ቁ home for at least one week in the last
ଷ
ଽ
three months
ଵ if household does self-medication and
[Link] seeking behaviour ቀ ቁ
ଽ patronise non-orthodox healing centres
ଵ if household head does not have at least
[Link] of Schooling ቀ ቁ
ଵ ଺ 12 years of schooling
Education
ଷ
ଵ
[Link] to public primary school ቀ ቁ if public primary school is ≥5km away
଺

ଵ if household is not connected to the

[Link] to electricity ቀ ቁ
ଵ଼ public power supply
if household uses cow dung or bare
ଵ
[Link] floors ቀ ቁ mud/clay as floor or stays in a dirty
ଵ଼
environment
ଵ if household uses well or surface water
[Link] to safe drinking water ቀ ቁ
ଵ଼ as sources of drinking water
Standards of
ଵ
Living ଵ if household uses pit-latrine, bucket or
ଷ [Link] of toilet ቀ ቁ
ଵ଼ has no toilet facilities.
ଵ if household does not possess at least 5
[Link] holding ቀ ቁ
ଵ଼ of the total common assets listed
if household uses unclean
ଵ /environmentally unfriendly methods
[Link] fuel ቀ ቁ
ଵ଼ such as wood and charcoal as cooking
fuel
Source: Adapted from Alkire and Foster (2011) but modified to suit Nigerian situation.

Journal of Economics and Development 56 Vol. 20, No.1, April 2018

(2007, 2011) approach to determine the level al deprivation P for each household is defined
of deprivation among households surveyed. as the weighted sum of deprivations such that
d
Therefore, a dual-cut-off method of identifi- Pi = ∑Wi = 1
cation was employed. This involved two steps i =1
The next step was to assign a deprivation
which were the identification and aggregation score for each household according to their
methods. The identification method was used deprivations, which is the aggregated depriva-
to identify various deprivations suffered among tion, and this was done by taking the weight-
households and it involves setting a cut off for ed sum so that the deprivation score for each
the various deprivations which was the first household lies between 0 and 1. The score in-
cut-off and also setting a poverty cut-off, which creases as the number of deprivations of the
was the second cut-off and hence it is called the household increases and reaches its maximum
dual cut-off. If deprivation exceeds the poverty of 1 when the household is deprived in all com-
cut-off such household was considered as poor. ponent indicators. A household that is not de-
5.3.3. Multidimensional Poverty Measure prived in any indicator receives a score equal
Table 1 was adapted from Alkire and Foster to zero.
(2011) and slightly modified as appropriate to A second cut-off or threshold is used to
suit the socioeconomic setting being studied identify the multi-dimensionally poor, which
(South-west Nigeria in this case). It shows the in the Alkire-Foster methodology is called the
dimensions and indicators that were used in poverty cut-off. For the analysis of this study
the study as well as their various deprivation it is assumed that the poverty cut-off k = 1/3,
cut-off and weights assigned to each indicator. although, for the purpose of exposition and
Therefore, the study started with evaluation of comparison, the k value was varied and mul-
the achievement of the households in which tidimensional poverty was reassessed in each
individuals live to determine if there exists a case.
deprivation in any of the above-mentioned In the light of the above, a household was
indicators. Assuming xi is the achievement of considered poor if its deprivation score was
each household i in each indicator andziisthe equal or greater than the poverty cut-off. For-
deprivation cut off. A household is considered mally, in the MPI, a household is identified as
deprived if its level of achievement is below the poor if the deprivation score is higher than or
deprivation cut-off i.e. xi < zi. Following Alkire equal to 1/3. For those whose deprivation score
and Foster (2011) the study assumes positive or is below the poverty cut-off, even if it is non-ze-
negative externalities within the household in ro, this is replaced by a “0”; and this is referred
such a way that if one of the household mem- to ascensoring in poverty measurement. To
bers is malnourished, all the household mem- differentiate between the original deprivation
bers are considered malnourished. score from the censored score, the censored
Each dimension receives equal relative deprivation score with the notation Pi(k) was
weight wi and is evenly distributed among the used. Note that when Pi ≥ k , then Pi(k)=Pi, but
indicators of each dimension. Multidimension- if Pi< k, then Pi( k)= 0. Pi(k) is the deprivation

Journal of Economics and Development 57 Vol. 20, No.1, April 2018

score of the poor. had good toilet facilities. Similarly, the major-
The computation of the multidimensional ity (56.1 percent) of the sampled households
headcount ratio (H) to show the proportion of got their drinking water from deep wells while
households who experience multiple depriva- only 23 percent of the households had access to
q
tion is given by H= n . where q is the num- water from boreholes. About 36 percent of the
ber of households that are multi-dimensional- households use kerosene as a source of cooking
ly poor and n represents the total population. fuel, though only a few households (11 percent)
The intensity (or depth) of poverty within the were not connected to the public power supply
household, which is the average deprivation (Table 3).
scores (A) of households that are multi-dimen- Other welfare indices
sionally poor, was determined by: The results in Table 4 showed that close to 30
∑ i=1Pi (k )
n
percent of the households engaged in self-med-
A= ication in treating their various illnesses. Only
q
Therefore, the multidimensional poverty in- 14 percent attended government hospitals and
dex is given as: the major reason for this was the long distance
from their houses to government health facil-
MPI= H×A.
ities. A majority (63.1 percent) of the house-
6. Results and discussion holds did not have health centres around their
6.1. Socio-economic characteristics of houses. A majority of the children attend public
households schools, although most of the public schools
Table 2 presents the socioeconomic charac- were built far away from their houses, while
teristics of the sampled households. It was re- 39 percent of the households had access to
vealed that 68.2 percent of the sampled house- credit facilities which were acquired mostly
holds were headed by males. About 71 percent throughthe trading groups they belong to, such
of the household heads were within the ages as farmers’ and multi-purpose cooperative so-
of 40 and 60 years while the majority (79.2 cieties (Table 4).
percent) were married. Over 40 percent of the 6.2. Incidence of deprivation
households had post-secondary school educa- Table 5 shows the incidence of deprivation
tion and over 70 percent of the households had among the households in the study area. Re-
more than four people in their household with a sults indicated that the three (3) most occurring
mean value of five. deprivations households suffered were lack of
Living conditions of households possession of at least five (5) out of the com-
A fair proportion (42 percent) of the sam- mon assets listed (78 percent), lack of accept-
pled households live in multi-tenanted (face- able toilet (72.3 percent) and lack of nearness
to-face) houses and the most common flooring to health care facilities (72 percent). The inabil-
materials used for these houses (48.2 percent) ity of households to accumulate assets may en-
was concrete while about 30 percent used tiles. courage poverty because assets can be used as
Only 25.9 percent of the sampled households collateral to obtain a loan which may be invest-

Journal of Economics and Development 58 Vol. 20, No.1, April 2018

 Table 2: Socio economic characteristics of households
Variables Frequency Percentage %
Gender
Male 242 68.2
Female 113 31.8
Marital status
Single 11 3.1
Married 281 79.2
Separated 39 11.0
Widow/Widower 24 6.8
Age
< or =30 19 5.4
31-40 78 22.0
41-50 91 25.6
51-60 87 24.5
61-70 49 13.8
Above 70 years 31 8.7
Mean=42
Occupation
Farming 50 14.1
Trading 128 36.1
Civil servant 103 29.0
Others 74 20.8
Educational level
No formal education 34 9.6
Primary education 72 20.3
Secondary education 93 26.2
NCE/OND 64 18.0
HND/BSc 71 20.0
MSc/PhD 21 5.9
Household sizes
>=2 31 8.7
3–4 73 20.6
5-6 107 30.1
7-8 77 21.7
Above 8 67 18.9
Mean=5
Source: Field survey, 2015.

ed to generate income, improve livelihood and over-filled and partially collapsing pit latrines
reduce poverty aside from streams of income which are common in some households in the
some assets could generate directly. Carter and study area portends danger to the health and
Barret (2006) asserted that assets can give an safety of the people. Various toilet diseases can
insight into the poverty structure of households. be contracted and spread under such condi-
The use of unacceptable toilets such as dirty, tions. The health risk therefore is serious con-

Journal of Economics and Development 59 Vol. 20, No.1, April 2018

 Table 3: Distribution of households by living conditions
Variables Frequencies Percentage
Types of house
Face-to-face 149 42.0
Boys quarter 85 23.9
Flat 109 30.7
Duplex 8 2.3
Mansion 6 1.7
Types of floors
Concrete 171 48.2
Tiles 104 29.3
Marble 21 5.9
Terrazzo 29 8.2
Clay/Sand 27 7.6
Wood 3 0.8
Source of drinking water
Borehole 85 23.9
Deep Well 199 56.1
Surface water 71 20.0
Types of toilet
Pit latrine 220 62.0
Water closet 92 25.9
No facilities 36 10.1
Others 7 2.0
Types of cooking fuel
Electricity 14 3.9
Gas 92 25.9
Kerosene 128 36.1
Charcoal/sawdust 47 13.2
Wood 78 22.0
Access to power supply
No 39 11.0
Yes 316 89.0
Source: Field survey, 2015.

sidering the discovery that healthcare facilities access to healthcare facilities in the study area.
were far away from most households, thereby 6.3. Deprivation count
limiting access to good health care. Lack of ac-
Table 6 reveals that only 21 households rep-
cess to health-care facilities was the third most
frequent deprivation. Amatyr Sen’s capability resenting 5.91 percent of the total number of
theory of human welfare asserted that function- households were deprived in only one out of
ing (health) and capability were the two main the eleven (11) deprivations, while 7.9 percent
components of human welfare. Therefore, hu- were deprived in all the eleven indicators con-
man welfare is made worse off due to lack of sidered for the study. The majority of the house-

Journal of Economics and Development 60 Vol. 20, No.1, April 2018

 Table 4: Other welfare indices of households
Variables Frequencies Percentage
Health seeking behaviour
Private hospitals 135 38.0
Public hospitals 51 14.4
Traditional/orthodox healing centre 71 20.0
Self medication 98 27.6
Schools attended by children
Public school 243 68.5
Private school 112 31.5
Access to credit facility
Yes 139 39.2
No 216 60.8
Nearness of household to health centres
Yes 224 63.1
No 131 36.9
Source: Field survey, 2015.

holds were deprived in between three (3) and were deprived in a noticeable number of indi-
nine (9) deprivations out of the eleven depriva- cators.
tions considered. For instance, 13.24 percent of 6.4. Identification of the poor under varied
the households were deprived in three (3) indi- cut-off
cators while 11 percent were deprived in eight It would be recalled that the eleven indica-
(8) of the listed indicators. Hence, the majority tors of deprivation were grouped into three (3)

Table 5: Incidence of deprivation

Deprivation Number of households Percent
Nearness to Health Centre 257 72.0
Diet sufficiency 227 64.0
Access to healthcare 170 47.9
Years of Schooling 128 36.1
Nearness to primary school 185 52.1
Access to electricity 50 14.1
Acceptable material for flooring 121 34.1
Access to safe drinking water 227 64.0
Use of acceptable toilet 258 72.3
Possession of at least five of the total assets listed 277 78.0
Cooking fuel (use of clean/ environmentally friendly method 122 34.4
Source: Computed from Field Survey Data, 2015.

Journal of Economics and Development 61 Vol. 20, No.1, April 2018

 Table 6: Distribution of deprivation count
Count Number of households Percent
1 21 5.91
2 43 12.11
3 47 13.24
4 31 8.73
5 27 7.61
6 25 7.04
7 31 8.73
8 39 11.00
9 37 10.42
10 26 7.32
11 28 7.90
Source: Computed from Field Survey Data, 2015.

groups, namely health, education and standard Multidimensional poverty estimation in this
of living, with each group having a weight of study was based on three dimensions, which
1
/3 out of a weighted score of one (1). When the were Health, Education and Standard of living
poverty cut-off was set at k = 1/3, 69 percent of of the households. From the results, it was re-
the households were identified as poor. Expect- vealed that when k was set at 1/3, sixty-nine (69)
edly, when k was set at 2/3, the number of poor percent of the households were in acute pover-
households decreased to 157, representing 44.2 ty as revealed by the head count ratio (Table 8).
percent of the total households sampled. Fur- They were deprived in at least either all the in-
thermore, 7.9 percent of the households were dicators of a single dimension, or a combination
identified as poor when k was set at 3/3, i.e 1. of indicators across dimensions, such as living
Under this last scenario, a household must be in a household with clay floor, no good toilet,
deprived in all the listed indicators to be quali- dirty floor and unclean sources of drinking wa-
fied as “poor”. ter. The percentage of the poor reported in this
6.5. The MPI: Adjusting the headcount ra- study was far higher than those reported by pre-
tio by intensity vious studies carried out in the same region us-

Table 7: Identification when cut-off is varied

Cut-off K Number of households Percent
1
245 69.0
3
2
157 44.2
3
3
28 7.90
3
Source: Computed from Field Survey Data, 2015.

Journal of Economics and Development 62 Vol. 20, No.1, April 2018

 Table 8: Multidimensional Poverty at varied cut-off
Head Count Poverty Intensity
Count � ∑�
��� �����
MPI (Mo) = H*A
(H) = (A) =
� �

1
0.690 0.650 0.450
3
2
0.442 0.416 0.184
3
3
0.079 0.074 0.006
3
Source: Computed from Field Survey Data, 2015.

ing the money-metric method of Foster, Greer 65 percent of the weighted indicators. This
and Thorbeck’s (FGT) index. For instance, Ak- was revealed by the intensity of poverty (A),
erele and Adewuyi (2011) reported 38 percent which was 65 percent. The 69 percent figure
in Ekiti State; Olawuyi and Adetunji(2013) is “adjusted” by the intensity of poverty, and
reported 45 percent among rural households that is why the MPI is what Alkire and Foster
in Ogbomoso agricultural Zone in Oyo State; (2007, 2011) called the Adjusted Headcount
Adebayo (2013) reported 36 percent among Ratio. However, because they (69 percent of
households in Irewole Local Government Area the households) were on the average deprived
of Osun State, while Akinbode (2013) reported in 65 percent of the weighted indicators, the av-
34 percent, all in south-west Nigeria. The rela- erage household in the study area can be said
tively higher percentage reported in this study to be deprived in 45 percent (MPI) of the total
may be due to the robustness and the perceived potential deprivations it could experience over-
superiority of the multidimensional approach. all (Table 8).
Furthermore, Table 4 shows that the average Furthermore, when k was set at 2/3, the head
poor household in the study area was deprived count ratio (H) was 0.442 with a poverty in-
in 65 percent of the weighted indicators. The tensity (A) value of 0.416 and MPI of 0.184.
MPI represents the share of the population that Under this scenario, it can be summarized that
is multi-dimensionally poor, adjusted by the average household in the sample were deprived
intensity of the deprivation suffered. This ad- in 18.4 percent (multidimensional poverty) of
justment is necessary because if only the Head the total potential deprivation it could suffer.
Count Ratio (H) was considered, it merely Furthermore, when k was set at 3/3, i.e 1, MPI
shows that 69 percent of the population were was 0.006, which implied that under such a
poor. Meanwhile, they were not equally poor scenario the average household was deprived
and they were not deprived in 100 percent of in 0.6 percent of the total potential deprivations
all the deprivations considered. The average it could suffer. The value of H=0.079 implied
poor household in this study was deprived in that 7.9 percent of the sampled households

Journal of Economics and Development 63 Vol. 20, No.1, April 2018

were classified as poor (Table 8). The falling = 1/3. It was revealed that the poverty head count
indices and incidence of poverty with an in- was higher (81 percent) among female-headed
creasing value of k as observed in this study is households compared with male-headed house-
in line with the findings of Adeoti and Popoola holds’ head count of 62 percent. This finding
(2012) in a study of multidimensional poverty supports the concept of feminization of poverty
of rural children in Nigeria. where it has been widely believed that females
6.6. Poverty profile by households’ socio- and female-headed households are likely to be
economic characteristics poorer than their male counterpart, partly due
Table 9 shows the breakdown of incidence to limited access to productive resources such
and depth of poverty by households’ socioeco- as land and credit among other sociocultural
nomic characteristics. It is worthy of note that constraints limiting the potentials of the female
the breakdown carried out here was based on k folks.

Table 9: Poverty profile of households by socioeconomic characteristic at K=1/3

Head Count (H) Poverty Intensity (P) MPI =H*A
Gender of household head
Male 0.62 0.58 0.36
Female 0.81 0.76 0.61
Marital status of household head
Married 0.61 0.57 0.35
Single 0.76 0.71 0.54
Divorced/Separated 0.73 0.68 0.48
Age of household head
≤40 0.80 0.75 0.60
41 – 60 0.57 0.53 0.30
Above 60 0.45 0.42 0.19
Occupation of household head
Farming 0.83 0.77 0.64
Trading 0.62 0.58 0.36
Civil Service 0.51 0.48 0.24
Private Company workers 0.54 0.51 0.27
Artisans/Self Employed 0.56 0.53 0.30
Educational Level
No Formal Education 0.85 0.80 0.68
Primary School 0.74 0.70 0.52
Secondary School 0.68 0.64 0.44
Higher Institution 0.42 0.40 0.17
Household Size
≤4 0.58 0.55 0.32
5-8 0.77 0.73 0.56
Above 8 0.83 0.78 0.65
Source: Computed from Field Survey Data, 2015.

Journal of Economics and Development 64 Vol. 20, No.1, April 2018

 In terms of the marital status of household In addition, poverty incidence reduced with
heads, households headed by married people increased education (Table 9). This underscored
were less poor (61 percent) compared with the importance of human capital development
those headed by single (73 percent) and di- through education as a means of reducing pov-
vorced/separated among whom 76 percent of erty. Educated individuals are better positioned
the households were classified as poor. It is a to get better paying jobs and are likely to live
common practice for married couples to pool within an acceptable lifestyle. Finally, poverty
resources together to acquire assets and for in- increased with increased household size (Table
vestment which may take the household out of 9). This confirms that a high dependency ratio
poverty. The foregoing is almost not possible puts pressure on household resources, there-
for single and divorced individuals. by increasing the incidence of poverty among
Furthermore, poverty indices (head count, households.
intensity and MPI) reduced with increased age 7. Conclusion and recommendation
of the household head. This may be interpreted Based on the findings of this study, it can be
that older household were less poor compared concluded that the majority of the households
with younger households. It is likely that old- in the study area were multi-dimensionally
er households have more income generating poor, even with varying cut-offs. They lived in
investments, assets/properties and might be conditions that depicted poverty. Most of the
enjoying remittances from their children liv- households lived in multi-tenanted (face-to-
ing and working elsewhere. Younger house- face roomed) houses and used pit latrine toilet
holds are likely to have a number of children facilities. The majority of the households had
in primary and secondary schools for which access to electricity but lacked a good source of
they carry some responsibility, including the drinking water and used unclean fuel sources
struggles to acquire property like houses, farm- such as charcoal, firewood, sawdust and ker-
lands and vehicles among several others which osene stoves and the environmental implica-
weigh heavily on their often limited resources. tion of these may be far reaching. The possible
Households headed by farmers had the highest negative effect may include deforestation, ero-
poverty incidence (83 percent) compared with sion, loss of the air purifying function of for-
those headed by people engaged in other occu- est trees etc. Health-care centres and primary
pations. Poverty being endemic among farmers schools were far from most households. House-
was a mirror to the underdeveloped level of ag- holds patronize medicine shops and engaged in
riculture in Nigeria. The majority of Nigerian self-medication for treatment of their various
farmers are poor due to lack of access to credit, illnesses. Most households use concrete floors,
land tenure problems, lack of storage facilities although a noticeable number still use ordinary
for agricultural output, which usually results in clay/mud and sand as their flooring material
high postharvest losses, lack of mechanization, and live in a dirty environment.
unstable prices and sometimes unfavourable A breakdown of poverty by households’
government policies. socioeconomic characteristics revealed that

Journal of Economics and Development 65 Vol. 20, No.1, April 2018

female-headed households were poorer than towards: encouraging schooling (by building
male-headed households. Married households schools in the neighbourhood of new settle-
were less poor compared with single and di- ments in major cities in the region), making
vorced household heads. The older the house- available free or highly subsidized family
hold heads the lower the incidence of pover- planning (to avoid large household size), the
ty among the households. It is worthy of note diversification of income sources (in order to
that poverty was higher and more pronounced improve household incomes), ensuring that
existing environmental and sanitation laws are
among households headed by farmers com-
enforced in order to promote good hygiene,
pared with those headed by individuals engaged
and adoption of improved toilet and waste dis-
in other occupations. Poverty reduced with an
posal practices. Furthermore, government may
increased educational level of household heads
help in financing the construction and running
while the poverty incidence increased with in- of community health centres in the area while
creased household size. appropriate health enlightenment is embarked
Based on the findings of this study, it is rec- upon in order to improve the health-seeking be-
ommended that government policies be geared haviour of the people.

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