The Study of Poverty in Iran's Rural Households in Five Economic Development Plans: 1989-2013

Poverty is an undesirable economic and social phenomenon and one of the important causes of poverty is unfair distribution of income amongst the people. The governments should adopt suitable policies for eradication of poverty in the society. In this study, the poverty line of Iran's rural households is estimated by the theory of relative habit of formation of linear expenditure system (RHLES) and by using data of household's expenditure for 8 commodity groups over the periods of 1989-2013. Then, the position of poverty in rural regions is calculated by the indicators of headcount ratio, poverty gap and Foster, Greer and Thorbecke (FGT). The results of the study show that although the poverty line (minimum subsistence quantity) in Iran's rural households has had an average growth of about 21.3 percent, the value of poverty indices are reduced during the five economic development plans. Thus, we may conclude that the government policies for the reduction of relative poverty in rural regions have been successful.