Urban-Rural Differences in Costs of Living and their Impact on Poverty Measures
Asra, Abuzar | February 1999
Abstract
This note demonstrates empirically the importance of urban-rural price differences and inflation figures in poverty analysis in Indonesia. Using data from the National Socio-Economic Survey (Survei Sosial Ekonomi Nasional, widely known as Susenas), it shows that the urban-rural food price differential during the period 1987-1996 was 13-16%, not 28-52% as implied by the 'official' food poverty lines. The urban-rural poverty comparisons and the components of change in simulated poverty estimates presented here therefore differ from those based on the 'official' figures. They indicate that migration to urban areas between 1987 and 1996 accounts for a significant part of the observed decline in poverty. The paper concludes that it is essential to use accurate urban-rural cost of living differences in deriving aggregate, urban and rural poverty estimates.
Citation
Asra, Abuzar. 1999. Urban-Rural Differences in Costs of Living and their Impact on Poverty Measures. © Asian Development Bank. http://hdl.handle.net/11540/2555. License: CC BY 3.0 IGO.Keywords
Agricultural And Rural Development
Development In East Asia
Infrastructure Development Projects
Institutional Development
Millennium Development Goals
Policy Development
Social Development Programs
Social Development
Rural planning
Aid coordination
Industrial projects
Infrastructure projects
Natural resources policy
Educational development
Social participation
Political participation
Community banks
Business planning
Infrastructure
Sustainable urban development
Social contract
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