| This research addresses three questions: (i) how have the incidence of poverty and the distribution of income changed? (ii) what factors are associated with rural household income change? and (iii) what factors are associated with moving out of or into poverty in the short-run? The analysis presented is based on a nationally representative two-period panel data set from Mozambique, covering the years 2001/2 and 2004/5. We cannot unambiguously argue that poverty headcount in 2005 (a year of more widespread drought) was higher than poverty headcount in 2002, but the poverty gap and squared poverty gap measures were both higher in the second period. Poverty has spatial, demographic, and asset holding dimensions. The diversification of off-farm income sources is strongly associated with increases in household income, and thus poverty reduction. For agricultural activities, especially crop production, reduction in vulnerability to drought is important for poverty reduction. Access to price information is positively correlated with income and poverty reduction in all areas, and the cultivation of tobacco is also significant in reducing poverty in the central part of the country. The impact on poverty of growing tobacco or cotton in the north was not significant, however. We also found that increases in landholding size can reduce poverty in rural Mozambique but will require additional inputs such as labor, fertilizers, and animal traction. |
