International Journal of Economics, Commerce and Research (IJECR) ISSN 2250-0006 Vol.

3, Issue 3, Aug 2013, 69-76 TJPRC Pvt. Ltd.

ANALYSIS OF POVERTY IN FEMALE HEADED HOUSEHOLDS: A CASE STUDY OF MULTAN CITY

HINA ZAHRA BOKHARI, SHAHNAWAZ MALIK & ALI AKBAR GARDEZI Department of Economics, Bahauddin Zakariya University, Multan, Pakistan

ABSTRACT
Poverty in female headed households is a complex and common phenomenon in developing countries like Pakistan. Gender based poverty is one of the main concerns of policy makers in the developing countries. The magnitude of poverty in female headed households is rising with time. Multan is the third largest city by area and fifth largest city by population of Pakistan. Educational attainment rate, unavailability of medical resources, less control on family assets and least earning opportunities are some of the basic reasons of poverty in female headed households. Scope of this study was to highlight the main factors of the said issue. Data was collected through questionnaire in a household survey. It was found that there has been increasing trend of poverty where the social indicators were either low or missing.

KEYWORDS: Poverty, Female Headed Households, Gender Based Poverty, Developing Countries INTRODUCTION
It is a very known and familiar fact that poverty in female headed households in developing countries, like Pakistan, is increasing. Rural and urban households on average are likely to comprise up to seven members, including parents, five and seven children. Here females are less educated, they have less access to health facilities, less control of assets, less access to social security, less access to financial resources and less earning capacity. These reasons are responsible for the higher incidence of poverty among females and in female headed households. A large number of studies relating to poverty in female headed households in the world have been emerged during the past few decades. But few studies have been attempted to address the issue of poverty in female headed households in Pakistan, based on empirical analysis.

EMPIRICAL LITERATURE
Recent empirical literature emphasizes that in the post structural adjustment period the slowdown in economic activity has also resulted in higher of poverty in females in the developing countries. Khan (1999) found an increasing trend in feminization of agricultural labor and feminization of poverty in the post adjustment period. But the study by Brown (1992) argues that employment is a key factor in determining females empowerment and some aspects of economic reforms hold for improvement in the labor market in the long run. According to Heyzer & Sen (1994), Women are participating hand in hand with males. Hence, in the generation of economic opportunities for the poor, there is need to target resources to women. Fuwa (1993) worked on establishing the relationship between female headship and poverty. Nguyen et al. (1994) analyzed in their study, that with the help of the World Bank, if women were given freedom from constraints, it would have helped to eradicate poverty. Quisumbing et al. (1995) presented new evidences on association between females and poverty based on an empirical analysis of 11 data sets from 10 developing countries. Lekskes (1998) analyzed gender awareness policies of large as well as of

70

Hina Zahra Bokhari, Shahnawaz Malik & Ali Akbar Gardezi

the small Non-Governmental Development Organizations (NGDOs) working for gender development policies and hired specialists of gender. Osman (2002) elaborated that gender dimensions of poverty in rural communities of Sudan limits womens entitlements & capabilities. He also suggested that for sustainable development, eliminating cultural, political & economic discrimination against women is a pre-requisite of eradicating poverty. Zuckerman (2002) said that main issue of gender inequality was the problem of home care and safe transport for women if they were employed in jobs in order to reduce gender unemployment. Gangopadhya & Wadhwa (2003) hypothesized in their research that gender bias had to do with an inherent bias girls face within the household. Worofa (2004) acknowledged in his research that poverty wasnt only just low income; it was also abo ut powerlessness and exclusion from decision-making. Nandal (2005) examined how lack of skills in women, heavy physical work of different types, long hours of work with limited payments, lack of job security and lack of minimum facility at work place contributes in gender-based poverty. They further added that FHHs had low total monthly income. They were less paid as wages for their services in labor market as compared to male workers.

METHODS
Sources of Data In the present study, we make use of primary source of data as collected through household survey from Multan city Multan city, which is a city comprising of 65 percent urban population and 35 percent rural-migrated, relying mostly on agriculture and rest on either self employed, working in any small or medium industry or unemployed. A questionnaire was prepared and then given to the sampled population. Questionnaire contained basic questions that helped to analyze their economic conditions. The format of the household questionnaire, covering the broad aspects of households socio-economic and demographic characteristics, is such that the information could easily be transformed on an individual basis. The modes of the household survey data collection are the following: Direct questioning of household head and other members Extracting data from participant observation Interviewing of selected informants. A sample of 100 households headed by females was taken from all over the Multan city using simple random sampling technique. Data was in the raw form, as it was taken through personal correspondence. Sample was selected from different organizations and institutions where there were women in majority. Govt. Girls Schools, Govt. College for Women, APWA (All Pakistan Women Association) were the main sources. Methodology In this study, the simple linear regression model is used to modify the relationship between DEPN, EARN, PART, HHSZ, EDUC and LITR are taken as independent variable and LPCI is taken as dependant variable. In order to check the significance of the model various tests like R-square, adjusted R-square, t-test and F-statistic are also taken. T-test is used to check the significance of the dependent variable. In order to check the significance of the results we use R-square and adjusted R-square. F-statistics is also used to check the overall significance of regression. Higher the value of F-Statistic suggests the significant relationship between Explained and Explanatory variables.

Analysis of Poverty in Female Headed Households: A Case Study of Multan City

71

An alternative most widely method of analyzing the determinants of poverty, is the econometric technique. In our econometric analysis, we will perform a multivariate income regression and alternatively, a Logit model on the potential determinants of urban poverty in terms of households socio -economic and demographic characteristics. We will estimate the following estimations using OLS method: LPCI = 0 + 1 EARN 2 DEPN + 3 PART 4 HHSZ + 5 LITE LPCI = 0 + 1 EARN 2 HHSZ + 3 LITE Where LPCI = is the log of per capita income, EARN = is the number of earners, DEPN = is the dependency ratio, PART = is the participation rate, HHSZ = is the household size, LITE = is the literacy rate EARN has a positive relation with per capita income, as number of earners increases in a family, its per capita income rises as well. DEPN has a negative relation with per capita income, as there is more dependency rate, there will be less per capita income. PART has a positive relation with per capita income. As the participation of individuals in a family increases, its income rises; hence it increases the per capita income in result. HHSZ has negative relation with per capita income, less persons in a family will have greater share in family total income, resulting high per capita income. LITE has positive relation with per capita income, more educational attainment of a family, greater will be their chances of getting jobs and hence will have high per capita income. (1) (2)

RESULTS AND DISCUSSIONS

The major objective of this study is to identify the significant determinants of poverty in female headed households in Multan city based on primary source of data of 100 respondents. In this section, before having the estimates of regression analysis, descriptive analysis is presented and has been tabulated in table 1 to infer into descriptive statistics. As the information shows the total size of the sample was 100 households, which were completely headed by the female members of that family. Table 1: Descriptive Statistics Variable Mean Median Standard Deviation POVT 0.5100 1.0000 0.5024 LPCI 3.0912 3.0569 0.3590 EARN 1.8700 2.0000 0.9812 DEPN 0.3380 0.3333 0.2074 PART 0.4512 0.4254 0.2710 HHSZ 6.6000 6.0000 3.393 LITE 0.5000 0.5000 0.5025 Source: Household survey by the authors in 2009 Variables determining the poverty were like Poverty itself, i-e. either households were poor or not. (LPCI) Log of per capita income, which is the total income earned by a family divided by total number of members in that family. Min 0.000 2.3010 1.000 0.000 0.0120 2.000 0.000 Max 1.000 3.9700 5.000 0.8333 1.5000 22.000 1.000

72

Hina Zahra Bokhari, Shahnawaz Malik & Ali Akbar Gardezi

Number of potential earners vs. number of actual earners in a household/family. Dependency ratio (which was the ratio between earners and non-earners). Participation rate, which gives that amongst all, how much each and every member of that family, is participating financially or in economic activities.

Household size gives the size of the household (in each family), which means that on average how many members are present in a single household.

Finally, literacy rate means that how many amongst that family were educated or how many of them were not. The descriptive analysis is based on the basic statistical concepts like Mean, Median, Standard Deviation, Minimum

and Maximum values of the variables. Mean of the variable poverty is 0.51 which means that 51% of the sampled population is poor or living below/under the poverty line. Standard deviation of variable poverty is 0.5.24 which means that the mean value might deviate from 0.5024, like as 0.51 0.5024. Mean of LPCI is 3.0912, EARN is 1.8700, DEPN is 0.3380, PART is 0.4512, HHSZ is 6.600 and of LITE is 0.5000. A complete detail of rest of variables can be observed from the estimates of table 1. Table 2: Showing Data Values Using MINITAB LPCI = 2.74 + 0.128 EARN 0.027 DEPN + 0.168 PART 0.0231 HHSZ + 0.384 LITE Predictor Coef St. Dev T P CONSTT 2.74459 0.07979 34.40 0.000 EARN 0.12819* 0.02956 4.34 0.000 DEPN -0.0269 0.1258 -0.21 0.831 PART 0.1683** 0.1037 1.62 0.108 HHSZ -0.02305* 0.007535 -3.06 0.003 LITE 0.38430* 0.06128 6.27 0.000 Source: Household survey by the authors in 2009 S = 0.2001 R-Sq = 70.5% R- Sq (Adj) = 68.9% Analysis of Variance (ANOVA) Source Regression Error Total DF 5 94 99 SS 8.9978 3.7637 12.7615 MS 1.7996 0.0400 F 44.95 P 0.000

The empirical result shows the explanatory power of the regression equation, as measured by R-Sq, to be significantly high (R-Sq = 70.50%). In other words, about on average, 70 percent variation in the dependent variable (natural log of per capita income) is due to the explanatory variables and remaining 30 percent is due to the other non-mentioned variables. The joint or over all test of significance, F-test, is accepted at 1 percent and 5 percent level of significance. All variables have the correct signs in the equation. EARN, HHSZ and LITE are significant at 1 percent of level in equation. While, PART is significant at 5 percent. Table 2 shows the regression analysis of first equation. The estimates shows that all the variables (except DEPN) are statistically significant as well as have expected signs. According to the result, EARN has positive impact on LPCI and a unit change in EARN will lead to 0.13 units change in dependent variable (LPCI) and EARN is statistically significant at 1 percent level. In other words, per capita income increases and poverty level falls as one potential earner is added to a family. DEPN (Dependency Rate) is not significant and shows that a unit change in DEPN has minor effect ie.0.027 units in dependent variable (LPCI). However results shows expected negative relationship between DEPN

Analysis of Poverty in Female Headed Households: A Case Study of Multan City

73

(Dependency Rate) and the dependent variable (LPCI). As the number of dependent persons increases in a household, their average share in PCI decreases. Hence, each rising unit in family member brings a fall in his/her share in income. In other words, Per capita income decreases and poverty level rises as one dependent member is added in a family. Participation rate PART is statistically significant at 5 percent level and there is a positive relationship between dependent variable LPCI and PART. According to the results, a unit change in PART will lead to an increase of 0.168 units in dependent variable (LPCI). As there will be more potential earners in a household, their PCI will be greater. In other words, per capita income increases and poverty level falls as the participation rate of members in a family increases. HHSZ is also significant at level of 1 percent and is negatively related with dependent variable (LPCI). A unit increase in HHSZ will reduce LPCI about 0.023 units, due to increase in dependency ratio. As there will be more members in a household, their PCI will decrease eventually. Per capita decreases and poverty rises as one more member is added in a family. Literacy rate (LITE) is also positively related with dependent variable (LPCI) and statistically significant at 5 percent level. Results show that a unit change in LITE will lead to 0.384 units change in dependent variable (LPCI). As the literate individuals have greater earning opportunities as compared to illiterate individuals, the households with more literate persons (individuals) have lower dependency rate due to higher percapita income. Empirically, it is established that socio-economic and especially demographic variables have the significant impact on per capita income of households as well as on the reduction of poverty. Table 3: LPCI = 2.78 + 0.147 EARN 0.0273 HHSZ + 0.430 LITE Predictor Coef St. Dev T P CONSTT 2.78162 0.05064 54.93 0.000 EARN 0.14714* 0.02685 5.48 0.000 HHSZ -0.027337* 0.007046 -3.88 0.000 LITE 0.42965* 0.04594 9.35 0.000 Source: Household survey by the authors in 2009 S = 0.2008 R-Sq = 69.7% R- Sq (Adj) = 68.7% Analysis of Variance (ANOVA) Source Regression Error Total DF 3 96 99 SS 8.8916 3.8699 12.7615 MS 2.9639 0.0403 F 73.53 P 0.000

Table 3 contains the regression analysis with multiple variables. Basically, this will express the impact of different variables on the dependent variable. The empirical result shows the explanatory power of the regression equation, as measured by R-Sq, to be significantly high (R-Sq = 69.7%). In other words, about on average, 70 percent variation in the dependent variable (natural log of per capita income) is due to the explanatory variables and remaining 29.3 percent is due to the other non-mentioned variables. The joint or over all test of significance, F-test, is accepted at 1 percent level of significance. All variables have the correct signs in the equation. EARN, HHSZ and LITE are significant at 1 percent of level in equation. In Table 3, we have estimated the effect of three variables, i-e. Earner (EARN), Household Size (HHSZ) and Literacy Rate (LITE). Results show that all three variables are statistically significant at 1 percent level and also have expected signs. The number of Earners in a household (EARN) possesses a significant coefficient with positive sign, which shows that a unit change in explanatory variable (EARN) will lead to an increase of 0.147 units in dependent variable (LPCI). This positive relation indicates that the per-capita income of a household will increase with the increase in number of earners in a household.

74

Hina Zahra Bokhari, Shahnawaz Malik & Ali Akbar Gardezi

The household size has a negative relationship with dependent variable (LPCI) and a unit increase in household size (HHSZ) will reduce per-capita income about 0.03 units. According to the results, the literacy rate of households has strong positive relationship with dependent variable (LPCI). A unit change in (LITE) will lead to a change of 0.429 units in dependent variable i-e. Log per capita income (LPCI). So, Literate Female Headed Households have high per capita income due to better earning opportunities as compared to illiterate female-headed households. Table 4: Dependent Variable = Poverty (POV): 0, 1 Predictor Coef St. Dev Z P Odd Ratios CONSTT 5.290** 2.933 1.80 0.071 DEPN 12.029 5.488 2.19 0.028 1.68E+05 PART -6.873** 3.380 -2.03 0.042 0.01 HHSZ -0.4017 0.2962 -1.36 0.175 0.67 LITE -6.082* 1.904 -3.19 0.001 0.00 Source: Household survey by the authors in 2009 Log- likelihood = - 9.574 Test that all slopes are zero: G = 119.442, DF = 4, p-value = 0.000 Now we use a logistic regression in our table 4 as another and alternate econometric technique to analyze the main determinants of the poverty in terms of some qualitative and quantitative variables. In particular, the purpose of the model is to determine the factors that explain the probability of being poor. All results and estimations of income and logistic analysis are obtained by using the Minitab, statistical software in the present study. Logistic estimates of the poverty determinants are reported in table 4. The empirical results show that except CONSTT and PART, all of the coefficients in the regression are significantly different from zero at 1 to 5 percent of significance level. DEPN has the odd ratio more than 1 which confirms a positive relation with probability of being poor. On the contrary, the variables PART, HHSZ & LITE have odd ratio lower than one, which means that these variables are negatively correlated with the probability of being poor. In Table 4, the Dependent Variable Poverty (POV) is 1 if household is under poverty line and 0 otherwise. The results show that Dependency ratio (DEPN) and Participation Rate (PART) are statistically significant at level of 5 percent. Literacy Rate (LITE) is significant at level of 1 percent while Household Size (HHSZ) has expected sign but not significant. According to the result, a unit change in Dependency Ratio (DEPN) will lead to 12.029 units change in dependent variable Poverty (POV). The positive sign of DEPN shows that a household with higher dependency rate has a greater probability to fall below poverty line. Participation Rate (PART) has a significant coefficient (-6.873) with negative sign, which shows that a unit change in Participation Rate (PART) will lead to 6.873 units change in estimated logit i-e. (POV). Here negative sign shows that a household with higher Participation Rate has greater ability to fight against poverty and has less probability to fall below the poverty line. Although the Household Size (HHSZ) has no significant coefficient but has expected negative relationship with dependent variable (POV). According to the results, a unit change in (HHSZ) will lead to a change of 0.4017 units in estimated logit poverty (POV). Here negative sign indicates that as the size of household will increase, his ability to fall below poverty line will also increase and vice versa. Finally, the Literacy Rate (LITE) has significant coefficient with expected negative sign. The result shows that a unit change in Literacy rate (LITE) will lead to a change in logit estimate Poverty (POV) about 6.082 units. The negative sign shows that the literate female-headed households have greater ability to fight against poverty as compared to illiterate female-headed household.

Analysis of Poverty in Female Headed Households: A Case Study of Multan City

75

CONCLUSIONS AND SUGGESTIONS

The main concern of the study was to estimate the trend of the poverty in female-headed households of Multan city, on the basis of household size by members, number of potential earners, their literacy status and their participation in fami lys economic activities. In general females were less educated, had less access to health facilities, less control of assets, less access to social security, less access to financial resources and less earning capacity. These characteristics were responsible for the higher incidence of poverty among females. Main Conclusion During the past fifteen years, the ratio of female to male population has increased, but no significant achievements have been made to improve females quality of life and to improve their contribution to economic development. This study shows that: Despite rapid expansion in the health and education infrastructure, the status of human resources is lower in Pakistan as compared to other developing countries in the region. The female labor force participation rate increased but the rise in female unemployment is much sharper than for males. The female workers are concentrated in agriculture, services (domestic) and in manufacturing (small-scale) industries. Similarly, farming, production and community services are the main occupational categories. This implies that industrial and occupational choices are limited for females. The gender discrimination in the labor market did not change significantly over time. Despite of some reduction in percentage of poverty in some years, the absolute number of poor members in family of female-headed households is still large and it is increasing with the increase in size of the households. Suggestions In order to alleviate poverty in female-headed households effectively, we briefly summarized the main suggestions as follows: In order to reduce poverty in female-headed households, explicit recognition of the role of gender is needed. In Pakistan, an explicit recognition of significance of gender related issues, by policymakers. However, the performance of the policies is far below target in terms of female literacy, access to health facilities, access to credit, and access to job markets. In view of this dismal but improving performance, we can say that Pakistan needs to take drastic steps to involve females in the growth process effectively. The rate of return to education and experience show that improvement in human capital formation (education and learning) can be important in increasing womens economic involvement and a reducti on in gender-based poverty that has intergenerational impact.

REFERENCES
1. Brown, J.K. (1992 and Sanctuary: Cultural Perspectives on the Beating of Wives, Westview Press, Boulder, CO: USA. 2. 3. Fuwa, N. (1993) A Note on the Analysis of Female Headed Households in Developing Countries, Chiba University. Gangopadhyay, S. and Wadhwa, W. (2003) ARE INDIAN FEMALE - HEADED HOUSEHOLDS MORE VULNERBLE TO POVERTY, India Development Foundation.

76

Hina Zahra Bokhari, Shahnawaz Malik & Ali Akbar Gardezi

4.

Heyzer, N. and Sen, G. (1994) Gender, Economic Growth and Poverty: Market gro wth and the State Planning in Asia and the Pacific, Asia Pacific Development Centre.

5.

Khan. S. R. (1999) Gender and Structural Adjustment, Do World Bank And IMF Policies Work? St. Martins Press Inc. New York.

6.

Lekskes, J. (1998) Gender-Awareness and Policies: Theory and Practice among small NGDOs, Development in Practice, 8, (4), 478-482.

7.

Nandal, S. (2005) Extent and Causes of Gender and Poverty in India: A Case Study of Rural Hayana, Journal of International Womens Studies, 7(2), 182-190.

8.

Nguyen, M. C., Bhushan, A. & Bischoff, J. (1994) Implementing Gender Issues in Multilaterals: The Experience of the World Bank, Focus on Gender, 2 (3), 70-76.

9.

Osman, A. (2002) Challenges for integrating gender into poverty alleviation programs: lesson from Sudan, Gender and Development, 10 (3), 22-30.

10. Quisumbing, A. R, Haddad, L. & Pena, C. (1995) GENDER AND POVERTY: NEW EVIDENCES FROM 10 DEVELOPING COUNTRIES, Food Consumption and Nutrition Division, FCND Discussion Paper No.9. 11. Snyder, A. R., McLaughlin, K. & Findeis, J. (2006) Household Composition and Poverty among Female Headed Households with Children: Differences by Race and Residence. Rural Sociology, 71(4), 597-624. 12. Wordofa, D. (2004) Poverty-Reduction Policy Responses to Gender and Social Diversity in Uganda, Gender and Development, 12(1), 68-74. 13. World Bank, (1990), World Development Report, World Bank, Washington, D.C., USA 14. Zukerman, E. (2002) Engendering Poverty Reduction Strategy Paper (PRSPs): The Issues and the Challenges, Gender and Development, 10(3), 88-94.