Interdependence of rural household welfare measurement in the context of climate variability in Ethiopia.

The Ethiopian government and various stakeholders have made significant efforts to improve household consumption, poverty, and food security. However, the results have not met expectations. To ensure that programs are effective, it is critical to have a robust measure of well-being that considers social, economic, institutional and environmental challenges. Previous studies on welfare have focused on a single measurement, but it is important to recognize the interdependence between various well-being indicators to formulate comprehensive interventions and initiatives for rural households in the context of climate change and variability. This paper examines the dynamic link between unidimensional poverty, multidimensional poverty, and food security using panel data from Ethiopia. The interdependency of welfare measurements was estimated using a seemingly unrelated multivariate probit model with a conditional mixed process estimator with full information, a simulated maximum likelihood approach, and the presumption that different metrics can have various policy implications. The chances of interdependence wellbeing status were low for households that were simultaneously food insecure and poor or nonpoor. Multidimensional poverty has a higher success rate than food insecurity or consumption poverty. Unlike unidimensional poverty and food insecurity, multidimensional poverty has a higher chance of to be deprived. Policymakers must consider the synergies and trade-offs of different types of welfare and the dynamic linkage between climate-induced shocks and other covariates with household welfare to minimize households' vulnerability to climate-induced shocks for effective intervention for rural households to obtain a whole picture of wellbeing.

Rural household income mobility in Ethiopia: Dimensions, drivers and policy.

Welfare dynamics studies are useful in understanding how individuals, families, society, and a country are organised. For the last two decades, Ethiopia's economic reports on income disparity, poverty, and other welfare metrics have been hopeful and controversial. It is crucial to understand how rural households of various income levels perform over time and income mobility. Income mobility can be observed as a change in position over time between two income vectors, with some climbing and others sliding down and changing places at various rates. This study, therefore, explored the rural households' income mobility in Ethiopia using three waves of the Living Standards Measurement Study-Integrated Survey on Agriculture (LSMS-ISA) collected from 2011 to 2016. The Shorrocks rigidity index, transition probability matrix, Fields, and Ok methods were employed to analyse the relative and absolute income mobility. The logit model with conditional fixed effect was used to assess the drivers of individual households' income mobility and the multinomial logit model with conditional fixed effect as an alternative model. Based on the finding of this study, it is suggested to implement different policies targeting income growth to shorten mobility gaps and address factors contributing to downward income mobility in rural households in Ethiopia are necessary.