Variation in poverty and household incomes in the Philippines

This article is concerned with the analysis of the possible causes of variation in the incidence of income-only poverty and incomes across the provinces of the Philippines using cross-section data in 1990 and 1991. Assuming all other things remaining the same, the analysis indicates that the incidence of land ownership, the level of sanitary toilet facilities and the proportion of non-agricultural earners in the labour force explains to a statistically significant degree variations in poverty levels across provinces. In addition, these variables along with the availability of irrigation facilities and being located in the island of Luzon were also found to be statistically significant in explaining variations in the level of household incomes across the provinces. The regression results also indicate that the proportion of non-agricultural earners, in turn, is influenced by the level of access to electricity, the level of urbanisation, the rate of illiteracy, having an academic degree and the availability of paved roads. These latter econometric results suggest, therefore, that the links, or lines of causation between the independent variables and the level of poverty possibly are more complex than may be inferred from the results presented in comparable studies of poverty — studies that do not allow for variables operating in an indirect way, through other variables, on the level of poverty. If the results derived from various regression equations turn out to be robust after using improved data sets, then they have implications for the design of poverty-alleviation programs in the rural areas of the Philippines.