Determining the Poverty Line of Urban Households in East Azerbaijan Province by Using Linear Expenditure System

Measuring poverty can make the process of poverty evolutions understandable in every society and present an image of these developments during the time. Government can target and adopt appropriate decisions to do necessary measures as a result. In this regard, statistical study of poverty and its analysis at the level of province can be a guide for planners to reduce penury. The poverty line of urban areas in east Azerbaijan was estimated by using dynamic linear expenditure system (DLES) method assuming the formation of habits and using seemingly unrelated regression (SUR) model during 2001 to 2011. Components of eight commodity groups including food, clothing, housing, appliances and furniture, healthcare, transport and communication, recreation and education, and a group for other issues were used as well as their price index published by statistical center of Iran. The results obtaining from estimations by using STATA and Eviews soft wares indicate that poverty of urban areas in east Azerbaijan has ascending trend with an average growth rate of 23% during the period under review. The percentage of urban households below the poverty line of the Province is 50 percent on average, and poverty gap and severity of poverty indices have been reduced with average values of 42% and 23% respectively at the end of the period. Thus, according to the results for indicators of poverty, it can be said that although poverty eradication policies during the ten-year period of this research have improved the welfare of the poor people partially, the number of people below the poverty line has increased considerably during this period. The process of escalating prices can be one of the main reasons for this increase that can be solved by the government with curbing inflation.