Developing a Sustainable Economy in Cameroon

9 - The Determinants of Poverty in Cameroon

9 The Determinants of Poverty in Cameroon Bernadette Dia Kamgnia and Joseph-Pierre Timnou Introduction Poverty is quite a complex phenomenon, which places the individual in a state of destitution or indigence. Marginalization, exclusion and iniquity are some of the situations that characterize the poor, though these are far from being the only ones. The study of poverty can be done from an economic perspective, as well as a social sciences perspective. But the research work undertaken so far highlights only certain aspects of poverty, where one can seek to explain the probability of a given individual falling below the poverty line. This provides a framework to predict the probability of being poor. Yet overall the complexity of the phenomenon is better looked at in a multivariate analysis. In developed countries, poverty seems to be caused by unemployment. In the case of Sub-Saharan African countries in general and Cameroon in particular, the change in the structure of the labour market following the structural adjustment programmes has increased the level of poverty. Indeed, the unemployment of graduates has reached alarming levels because of retrenchment in recruitment in the public sector and the weak hiring capacity of the private sector. Yet the level of income or consumption, the type or the branch of activity, and even the economic level in a general can give an idea of the level of poverty in a given population. The level and the form of education, the sector of residence, etc., are equally relevant criteria in describing poverty, as well as demographic variables such as sex, age, household size, life expectancy at birth, morbidity or the level of mortality. Poverty can be conceived as a phenomenon resulting from the combination of economic, social and political environments. These create conditions, among others, of exclusion , marginalization and iniquity. Some of those factors were identified by the World Bank (1995) in explaining the living conditions in Cameroon in 1983/84. The Department of Statistics and National Accounting (1996), using the 1996 Cameroonian household budget survey, estimated a poverty incidence of 50.5 per cent for Cameroon as a whole, while the World Bank (1995) estimates indicated 40 188 Developing a Sustainable Economy in Cameroon per cent with respect to the living conditions in 1983/84. Using the same database of 1996 and based on the food energy intake method, Kamgnia and Timnou (2000) estimated the incidence of poverty at 51.8 per cent. Amin and Dubois (1999) show an increase of the poverty level over the years. Basing their work on the 1996 survey data Fambon et al. (2000) determined a rate ranging between 44 and 68 per cent using the ‘cost of basic needs’ method. How, then, has the structure of the determinants of poverty evolved? This chapter proposes to identify the determinants of poverty in Cameroon over the 1990s. More specifically, the factors are analysed according to their contribution to the classification of the households as poor and non-poor. Poverty, a Plural Phenomenon Poverty, being a multidimensional phenomenon, can be explained in a multivariate analysis such as discriminant analysis. The Concepts of Poverty There are two schools of thought on the measure and explanation of poverty: the welfarist approach and the capability approach. Whereas the first school provides a one-dimensional concept, the second approach conceives it as multidimensional. The welfarist conception of poverty From its conception, welfarism centres the debate on well-being. Well-being refers to what is fundamental in life, and what every individual strives for. Moreover, the individual is a rational individual, being able to rationally use endowments in order to attain the highest level of utility. Consequently, poverty is conceived as a difference in the ranking of the preferences so as to maintain a given level of well-being. Commonly used indicators of well-being are income and consumption expenditure. Both indicators lead to the determination of a poverty line, which is used in the ranking of income (expenditure) and thus in the comparison between states of poverty. An individual could be regarded as poor if, while working, he deliberately chooses to consume little, even though the potentialities of work and of consumption exist. Total consumption is preferred to income as it is less prone to fluctuating conditions , and is easily estimated from survey data. Yet neither of those two variables is a perfect proxy for well-being. Income and consumption do not express the role of the well-being in the evaluation of public goods and non-marketable goods...