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Generating Disaggregated Poverty Maps: An Application To Vietnam
Generating Disaggregated Poverty Maps: An Application To Vietnam
319±331, 2000
Ó 2000 Elsevier Science Ltd. All rights reserved
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Grosh (1994) show that state-level targeting in level poverty rates. Finally, Section 6 summa-
Mexico provides only small improvements over rizes and discusses the results of the study.
untargeted (uniform) transfers of the same
amount of money, but district- or neighbor-
hood-level targeting is signi®cantly more accu- 2. DATA AND METHODS
rate. In fact, Grosh (1994) demonstrates that
programs in Latin America that focus on clinics The Vietnam Living Standards Survey
and schools in poor neighborhoods can be as (VLSS) was carried out in 1992±93 by the
well targeted as programs that screen for eligi- Vietnamese State Planning Committee (SPC)
bility based on household income. and the General Statistical Oce (GSO) with
It is not easy, however, to obtain information assistance from the Swedish International
on poverty for a large number of small Development Agency and the World Bank. The
geographic units (e.g., districts or villages) VLSS used a strati®ed random sample of 4,800
throughout a country. Sample size constraints households, including 3,840 rural households
generally prevent the use of household surveys and 960 urban households. The 110-page ques-
for estimating poverty at the neighborhood, tionnaire collected information on household
city, or even district level. Most household members, housing, fertility, assets, employment,
budget surveys have samples of 2,000 to 6,000 agricultural production, income, and expendi-
households, allowing estimates of poverty for ture (World Bank, 1995; SPC/GSO, 1994).
just ®ve to 10 regions (Grosh & Mu~ noz, 1996). In 1994, the GSO conducted an Agricultural
This study develops a method to generate Census covering 11.5 million rural households
geographically disaggregated estimates of (including nonagricultural households). The
poverty by combining survey and census data. ®ve-page questionnaire collected information
In the ®rst step, I use data from the Vietnam on household members, housing, land use,
Living Standards Survey (VLSS) to estimate animal ownership, and assets (GSO, 1995).
the relationship between poverty and 25 indi- Although the Census did not collect informa-
cators (including household characteristics and tion on income or expenditure, it provides data
regional dummy variables). In the second step, on a number of household characteristics likely
the average values of these same 25 indicators to be correlated with poverty. Table 1 compares
for each rural district are extracted from the the data on household characteristics available
1994 Agricultural Census and are substituted from the VLSS with those available from the
into the estimated equation to generate district- Agricultural Census.
level estimates of the poverty rate. The results In the ®rst step of the procedure, I use probit
are presented in the form of district-level regression analysis with the VLSS data to esti-
poverty maps using geographic information mate the probability that a rural household is
system (GIS) software. poor as a function of 19 household character-
A similar approach was concurrently devel- istics and six regional dummy variables. 1 In
oped by Hentschel, Lanjouw, Lanjouw and probit analysis, the data are assumed to re¯ect
Poggi (1998) to examine the geographic distri- the following relationship:
bution of poverty in Ecuador. Having access to !
the household-level census data, they are able X
to calculate standard errors for the poverty y U a Bi Xi e ;
1
i
estimates. On the other hand, by using a
general census rather than an agricultural where y is a dependent variable taking values
census, the number of potential poverty indi- between 0 and 1, U
represents the cumulative
cators is more limited, as is the level of density function for the standard normal curve,
geographic disaggregation. Other methodolog- and the Xi are the independent variables.
ical dierences are discussed below. In this study, the dependent variable (y) is
The paper is divided into six sections. Section 0 or 1 depending on whether the household
2 describes the data and methods used in this is below or above the 30th percentile of per
study. Section 3 presents an overview of the capita consumption expenditure among rural
patterns in various poverty indicators in Viet- households. Consumption expenditure was
nam. Section 4 examines the relationship calculated by the author as the sum of
between poverty and the poverty indicators consumption purchases, the market value of
using regression analysis. Section 5 uses this home produced food, and the rental equivalent
relationship to obtain estimates of the district- of owner-occupied housing and major consumer
GENERATING DISAGGREGATED POVERTY MAPS 321
durables. A regional price index, calculated as Bank, 1995). The independent variables (Xi ) are
part of the VLSS study, was used to adjust for selected from the household characteristics
regional dierences in the cost of living (World listed in Table 1.
322 WORLD DEVELOPMENT
The second step in the procedure is to hand, the error is likely to be small, and it is the
combine the equation obtained from the ranking of districts and provinces, not the
regression analysis with the district-level mean poverty rate itself, that is important for policy
values of the same poverty indicators from the purposes.
Agricultural Census to generate a poverty index Third, in using continuous variables for
for each district. Because of dierences in the poverty indicators, this approach assumes that
values of the indicators between the VLSS and variation in poverty across districts will be
the Agricultural Census, a regional adjustment re¯ected in variation in the district-level means
factor is added to ensure that the average of the indicators rather than in the distribution
poverty rate for each region as derived from the within districts. If dierences in poverty are due
Census data is equal to the corresponding mainly to dierences in the distribution within
poverty rate in the VLSS data. Thus, poverty districts, the continuous variables used in this
estimates are calculated as follows: study will not be very accurate. This limitation
! does not apply to binary (dummy) variables
X used in the regression.
Pd U a^ ^
Bi X id Ar ;
2
Finally, because I did not have access to the
i
household-level census data, it was not possible
where Pd is the district-level estimate of the to estimate the standard errors for the district-
poverty rate, a^ and B^i are the estimated level poverty estimates. In their study of
parameters from the regression analysis, X id is Ecuador, Hentschel et al. (1998) show how to
the average value of the Xi household indicator calculate these standard errors when the
in district d, and Ar is the regional adjustment household data are available.
factor. Given the large number of rural districts, Three of the four limitations listed above are
it is convenient to present the results as a map associated with the use of district-level means
using GIS software. Sensitivity analysis is used from the census rather than original household-
to see whether the classi®cation of districts varies level data. Although the use of household data
depending on the choice of the poverty line. is preferable, this will often not be possible due
Four quali®cations need to be made regard- to problems of data access or processing
ing this method. First, the estimated coecients capacity. For example, the Agricultural Census
a^ and B^i are not necessarily consistent. The of Vietnam collected data from 11.5 million
probit regression model does not generally households.
provide consistent estimates of the coecients
in the presence of heteroskedasticity. More
seriously, some of the variables on the right- 3. CHARACTERISTICS OF RURAL
hand side of the regression equation, such as the HOUSEHOLDS
ownership of consumer durables, are endoge-
nous, being partly determined by per capita Table 2 presents the mean value of each
expenditure. In econometric terms, the error poverty indicator available in both the VLSS
term (e) is likely to be correlated with some of and the Agricultural Census. Regarding the
the ``independent'' variables (Xi ), so the esti- poverty indicators, the two surveys yield
mated coecients are subject to simultaneity remarkably similar results regarding the aver-
bias. This problem is common to all studies age value of household size, the proportion of
using regression analysis to combine poverty adults, the percentage of farm households, the
indicators (see Glewwe & Kanaan, 1989; Grosh percentage of ®shing households, food
& Baker, 1995; Wodon, 1997). This approach production, the percentage of land in perennial
can, however, be partially justi®ed by the fact crops, the percentage of irrigated annual crop-
that the objective is not to study the determi- land, the type and size of housing, source of
nants of poverty or the magnitude of the coef- water, and ownership of all three consumer
®cients but rather to develop a descriptive tool durables (radio, television, and motorbike).
to identify poor households. There are some dierences between the two
The second quali®cation is that, because sources, particularly in land per capita, the
equation (2) is nonlinear, the district-level number of livestock, and electri®cation. These
poverty rate will not be exactly equal to the rate dierences may be due to sampling error in the
obtained by inserting district-level means into VLSS, dierent de®nitions of the variables, or
the equation, even if the equation describes dierent criteria used to select households to
household poverty without error. On the other interview.
GENERATING DISAGGREGATED POVERTY MAPS 323
The Agricultural Census provides informa- durables, re¯ecting its urbanized population
tion on the geographic patterns in household and relatively high income. Finally, the
characteristics that are used as poverty indica- Mekong River Delta is relatively land abund-
tors. Table 3 shows the mean values of the ant and highly irrigated, contributing to its per
poverty indicators for the seven regions of capita food production which is substantially
Vietnam. For example, the Northern Uplands higher than that of any other region.
region has the highest concentration of minor- The advantage of the VLSS data is that it
ity households, farmers, and small livestock. By allows us to examine the relationships between
contrast, the Red River Delta has the least land poverty and household characteristics. Table 4
per capita, but its per capita food production shows the average value of the poverty indica-
(predominantly rice) is the second highest as a tors for rural households in dierent expendi-
result of very intensive irrigation. The two ture quartiles 2, based on the VLSS data. Poor
central coast regions are notable for the rela- households are characterized by larger size, a
tively large proportion of ®shing households smaller proportion of working-age adults, and
(3.5 and 6%). The Central Highlands has a less schooling among male adults. They are also
large minority population, abundant land, and much more likely to be ethnic minorities.
a high proportion of land allocated to perennial While the bulk of rural households have
crops (mainly coee). The Southeast has a large farming as their main occupation, the propor-
nonagricultural population and the highest tion is highest among the two poorer catego-
rates of ownership of the three consumer ries. Not surprisingly, the amount of land per
324 WORLD DEVELOPMENT
capita, food production per capita, and the Then a probit analysis is used to ``predict''
number of pigs per household tend to be lower poverty as a function of all the indicators,
among poor households. These households also based on the 3,840 rural households in the
devote a smaller share of their crop land to 1992±93 Vietnam Living Standards Survey
perennial crops. (VLSS).
House size, electri®cation, access to tap water
are all positively associated with expenditure
(a) Targeting with individual indicators
per capita. Similarly, the ownership of consu-
mer goods (radios, televisions, and motorbikes)
Table 5 shows the two measures of the
is strongly correlated with expenditure per
targeting accuracy of 22 poverty indicators
capita. Thus, Table 4 provides tentative
taken individually. The targeting criterion, in
support for the idea that these variables may
the second column, is the rule used to predict
serve as poverty indicators. In the next section,
which households are poor. For continuous
regression analysis is used to study the strength
variables, the criterion is set so that the
of these relationships, while controlling for
proportion of household that qualify is 30%,
other variables.
equal to the de®ned poverty rate (this is not the
only possible criterion; Wodon (1997) proposes
graphs that illustrate the tradeos involved in
4. RELATIONSHIP BETWEEN POVERTY alternative targeting criteria). ``Leakage,'' in the
AND INDICATORS third column, is the proportion of VLSS rural
households predicted to be poor by the target-
What is the relationship between poverty and ing rule that are in fact not poor. ``Undercov-
various poverty indicators? First, we examine erage'' refers to the proportion of poor
the accuracy of using each indicator separately. households that are not identi®ed as poor by
GENERATING DISAGGREGATED POVERTY MAPS 325
the targeting rule. An untargeted program Food production per capita, expressed in
(providing bene®ts to all households) would paddy equivalent, is a commonly used indicator
have a leakage rate of 70%, given our de®ned of to assess trends in food security (see GSO,
poverty rate of 30%, and an undercoverage rate 1995, pp. 59±60). Although per capita food
of 0%. Perfect targeting would imply no leak- production is correlated with household
age and no undercoverage. expenditure (see Table 4), the correlation is not
The table reveals that none of the indicators close enough to make it a good indicator of
is, by itself, very successful at identifying poor poverty. If a program targeted the 30% of rural
households. The leakage rates suggest that 60± households with the least per capita food
70% of the bene®ciaries under these targeting production, 64% of the bene®ciaries would be
rules would not be poor. The best leakage rate nonpoor households and 64% of the poor
is achieved by targeting ethnic minority would be left out. According to Table 5, simply
households since only 48% of them are not targeting households by the size of the dwelling
poor (in other words, 52% of the rural ethnic or by the mother's education level would be no
minority households fall below the 30th less accurate.
percentile of rural households). Only two other
indicators (region and proportion of working- (b) Targeting with combined indicators
age adults) also achieve leakage rates below
60%. The rates of undercoverage vary widely, A probit regression model is used to ``pre-
from less than 5% to over 75%. The lowest rates dict'' household poverty in rural areas as a
are achieved by using targeting rules that cover function of a group of indicators. Model 1
the vast majority of rural households, thus includes the full range of potential poverty
generating high leakage rates. indicators in the ®rst column of Table 1. Model 2
326 WORLD DEVELOPMENT
uses a subset of indicators that were useful in physical isolation, quality of agricultural land,
helping to predict whether or not a household is and other missing variables.
poor. Model 2 is also limited to indicators that Model 1 shows that households in which the
are available from the Agricultural Census, male adult has more education are less likely to
since only variables that are in both the VLSS be poor. On the other hand, the association
and the Agricultural Census can be used to between poverty and female education is not
generate the district-level poverty map. statistically signi®cant in this analysis. It should
Table 6 provides the results of Models 1 and be recognized, however, that female education
2. For each model and for each poverty indi- may aect household welfare in ways not
cator, the table gives the coecient (B^i from captured by our measure of poverty, such as
Eq. 1), the statistical signi®cance, and the through better nutrition or health. Model 2
marginal eect of the variable (oy=oX i ) eval- excludes education because this indicator is not
uated at the means of the independent vari- available in the Agricultural Census data.
ables. Holding other factors constant, female-
In both models, large households and headed households are about ®ve percentage
households with a small proportion of work- points more likely to be poor than are male-
ing-age adults are more likely to be poor. For headed households. Farming households are
example, the third column indicates that more likely to be poor, whereas ®shing house-
increasing the household size by one is associ- holds are less likely to be poor. Poverty is
ated with an ®ve percentage point increase in associated with having less land per capita,
the probability that a household is poor. Being lower food production per capita, and a smaller
an ethnic minority is associated with a 17 share of land allocated to perennial crops.
percentage point increase in the probability Similarly, households with small numbers of
that a household is poor. These ethnic dier- chickens, pigs, and cattle are more likely to be
ences presumably re¯ect language barriers, poor.
GENERATING DISAGGREGATED POVERTY MAPS 327
Housing characteristics also show a statisti- Ownership of the three consumer durables
cally signi®cant relationship with the likelihood is also a signi®cant indicator of poverty. One
that a household is poor. Families living in would expect this indicator to be particularly
permanent houses are less likely to be poor useful because it is less aected by occupa-
than those in semi-permanent houses, while the tion, farm type, and region than are the
latter are less likely to be poor than those in agricultural indicators such as animal
temporary houses. House size is also negatively ownership, food production, and perennial
correlated with poverty. The very large coe- crop area. Finally, the regional dummy
cient of the variable indicating tap water variables in the probit model indicate that,
suggests that it is very unlikely that a household even after controlling for the above factors,
with tap water is poor. the north and central coast of Vietnam are
328 WORLD DEVELOPMENT
poorer than Mekong River Delta, the refer- water is small, so access to well water is not a
ence region. 3 good indicator of poverty.
A few variables did not have a statistically If we simulate a program that targets the
signi®cant relationship to poverty after poorest 30% of households based on their
controlling for the other indicators: irrigation, predicted poverty rate according to these two
access to electricity, and access to well water. models, the leakage and undercoverage rates
The eect of irrigation is probably already are just 17.3% with Model 1 and 17.6% with
captured by the variable representing per capita Model 2. These rates are dramatically better
food production. Similarly, electricity only than those associated with the individual indi-
becomes statistically signi®cant when the tele- cators (see Table 5). Overall, 89±90% of the
vision variable is excluded from the analysis. rural households in the sample are correctly
Moreover, the dierence between households identi®ed as poor or not poor by these two
using well water and those using river or lake models.
Total 90 97
a
Source: Regression analysis of VLSS data at dierent poverty lines combined with poverty indicators from Agri-
cultural Census.
combining household survey data and census Fifth, this study highlights the value of census
data. The approach requires two databases data in studying the geographic distribution of
with an overlapping set of household variables, poverty. To maximize its usefulness for this
but is otherwise relatively easy to implement. In purpose, a census should include a wide range of
this exercise, we generate a map classifying 543 questions on household characteristics that are
rural districts in Vietnam, but the same method correlated with income and it should adopt
and data could, in principle, be used to classify de®nitions that are consistent with those used in
the 8,800 rural communes, providing an even the most recent household budget survey.
more detailed view of the geographic patterns Although the approach described in this
of poverty. paper shows potential for wider application,
Second, household characteristics are, indi- several caveats should be mentioned. First,
vidually, fairly weak predictors of rural since most countries conduct a census only
poverty. Even per capita food production is not every 5±10 years, this method cannot be used
a very good indicator of household poverty. for annual poverty monitoring. An important
This result is somewhat surprising given the research question is the degree to which the
overwhelming dominance of rice both as a spatial patterns of poverty change over time.
staple food and as a cash crop (Vietnam is Clearly, this approach is more useful if, as
among the three largest rice exporters in the seems likely, the geographic distribution of
world). This ®nding also contradicts the wide- poverty is relatively stable over time.
spread view in Vietnam that the degree of food Second, it is important to verify the accuracy
self-suciency is a good measure of the well- of poverty maps generated using the method
being of a household or region. described in this paper. The results presented
Third, household characteristics are much here generally conform to the perceptions
more accurate in predicting rural poverty when of Vietnamese ocials and international
combined using probit regression analysis. A experts with experience in rural Vietnam,
program targeting households using a poverty but a more systematic assessment would be
index combining 19 household characteristics useful.
and six regional dummy variables could reduce Third, even if we assume the maps are
leakage and undercoverage rates to 18%. accurate, it is an empirical issue whether
Fourth, the district-level poverty map geographic targeting is preferable to alterna-
suggests that rural poverty in Vietnam is tive targeting methods. The cost-eectiveness
strongly associated with distance from cities of any targeted program depends on the
and the coast. It is tempting to suggest that this administrative costs, the targeting criteria, the
re¯ects the economic value of access to markets distribution of income across and within
and that improved transportation infrastruc- targeting units, and the potential for the
ture would reduce poverty in these remote program to in¯uence household behavior. The
areas. But, this spatial pattern may also re¯ect availability of a disaggregated poverty map is
the in¯uence of other variables, such as not sucient to justify the use of geographic
topography, on the income-generating oppor- targeting, but it is a necessary ®rst step in
tunities facing rural households. evaluating this option.
NOTES
1. In contrast, Hentschel et al. (1998) use the logarithm 2. As above, ``expenditure'' refers to per capita
of per-capita expenditure as the dependent variable. The consumption expenditure, including the value of
advantage of their approach is that it provides consistent home-produced food and the rental equivalent of
estimates even in the presence of heteroskedasticity (as owner-occupied housing and consumer durables. The
noted below, probit estimation does not). But the quartiles are de®ned in terms of the number of
weakness is that it gives substantial weight to the ability households.
of the model to predict expenditure levels among
nonpoor households. For example, the value of the
coecients will be in¯uenced by their ability to predict 3. Provincial dummy variables were not used for
whether a household is in the middle quintile or the several reasons. First, there are 54 provinces but only
richest quintile, an ability which may be irrelevant to its 120 clusters of households, implying that many prov-
ability to distinguish poor and nonpoor households. inces would be represented by just one or two villages.
GENERATING DISAGGREGATED POVERTY MAPS 331
Second, three provinces were not represented at all in the characteristics (such as ethnicity) that are spatially
VLSS sample. Third, provincial dummy variables would concentrated.
remove much of the variation in those household
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