The determinants of multidimensional poverty in the urban slums of Dhaka city

Abstract

Communities in urban slums that are in dire need of uplifting from poverty are often overlooked in favor of countrywide macroeconomic initiatives to alleviate poverty. The poverty metrics utilized are generally based on income and expenditure. Nevertheless, poverty has a multifaceted nature with absolute and relative components. This paper examines the determinants of the Multidimensional Poverty Index (MPI) in the urban slum areas, utilizing a household questionnaire survey conducted in the slums of Dhaka, Bangladesh. We use the ordered probit regression method, a binary response model, to identify socio-economic, environmental, and climate-change-induced factors affecting different categories of poverty. Our estimation results show that child school attendance, structural vulnerability, use of shared toilets, and the household head’s education level have the most statistically significant impact on the MPI. While the findings from this paper can induce policymakers to take a community-specific approach in the urban slums of Dhaka city, the MPI’s shortcomings in capturing environmental factors increasing the vulnerability of communities to external shocks should not be overlooked.