HOUSEHOLD EMPOWERMENT AND MULTIDIMENSIONAL POVERTY IN RURAL ETHIOPIA: A PRINCIPAL COMPONENT ANALYSIS

Abstract

This study analyses the impact of potential household empowerment on multidimensional poverty
status of rural households in Ethiopia. Primary data have been collected from 450 sample
households in three districts of Ethiopia through the households’ survey in the year 2019. The
household empowerment index is constructed through principal component analysis and the binary
logit model is applied to assess the impact of household empowerment index along with control
variables on the multidimensional poverty status of the rural households. The results confirm that
the household empowerment has significant impact on reducing multidimensional poverty in the
rural areas of Ethiopia. The marginal effects reveal that keeping all other things constant, as the
amount of household empowerment index (economically, socially, and politically) increases by a
unit percent, on average, the probability of being multidimensional poor decreases by 1.17 percent.
The study suggests that the government and concerned bodies should give special attention to
alleviate the multidimensional poverty status of the community by increasing the potential human
empowerment (economically, socially, and politically) for rural households in Ethiopia.