Factors Affecting the Level of Poverty and Inequity of Urban and Rural Households in Iran

Economists have always sought to discover the factors that cause poverty, because by understanding these factors, they can plan to reduce poverty. The purpose of this study is to determine the poverty line and the factors affecting it in the year 2021.

In the present study, only the line and its indicators were estimated by the data of urban and rural households' expenditure and income plan in the year 1400 and using the linear expenditure system (LES), and the determining factors of poverty were investigated. Also, the impact of the probability of poverty on the characteristics of the households was investigated using the probit model with Stata17 software.

The poverty line for a household in 2021 was calculated as 73,980,000 Rials. The highest reduction in the probability of household poverty is related to the level of education of the head of the household. With the increase of each unit of education level, the probability of facing poverty in the household will decrease by 23.1%. After that, the number of working people in the household has the highest effect in reducing the probability of household poverty with a decrease of 19.9 percent. Among these variables, in terms of the household, having health insurance has the least effect in preventing the household from becoming poor.

The gender of the head of the household is effective in reducing poverty. Also, in households where the head is younger, the probability of poverty increases. More support for young people and creating more favorable conditions for their employment is necessary to reduce poverty. Increasing the level and depth of insurance coverage will also be effective in reducing poverty.