Abstract:
This paper investigates the link between poverty incidence and geographical conditions within rural Locations (administrative areas that usually contain several communities) in Kenya. Evidence from poverty maps for Kenya and other developing countries suggests that poverty and income distribution are not homogenous, with wide spatial variability. We use spatial regression techniques to explore the effects of geographic factors on poverty. The results show mixed effects of geographic variables at national versus provincial levels. Slope, soil type, distance/travel time to public resources, elevation, type of land use, demographic and income inequality variables prove to be significant in explaining spatial patterns of poverty. However, differential influence of these and other factors at the Location-level shows that Provinces in Kenya are highly heterogeneous; hence different spatial factors are important in explaining welfare levels in different areas within Provinces, suggested targeted pro-poor policies are needed. Policy simulations are conducted to explore the impact of various interventions on Location-level poverty levels. Investments in roads and improvements in soil fertility both are shown to potentially reduce poverty rates, with differential impacts in different regions of Kenya.
