[01] Adigun Grace Toyin, Department of Agricultural Economics and Extension, Landmark University, Omu-Aran, Nigeria. [02] Awoyemi Taiwo Timothy, Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria. [03] Fabiyi Esther Funsho, Department of Agricultural Economics and Extension, Landmark University, Omu-Aran, Nigeria.

In spite of increase in the growth rate of the economy in recent times and the huge revenues derived from oil, it is worrisome to discover that Nigeria is still suffering from high level of poverty. The study employs Shapley decomposition approach to address the paradox of whether economic growth in Nigeria reduces poverty or not. The result indicates that the so-called “trickle down” phenomenon, underlying the view that growth improves poverty is not supported by Nigeria’s data. The paper therefore investigates changes and the extent of poverty in rural Nigeria from 2004 to 2010. It examines the contributions of growth and redistribution factors to changes in poverty within the study period. The analysis is based on the National Living Standard Survey (NLSS) data of 2004 and 2009/2010 sourced from the National Bureau of Statistics (NBS). The study reveals that the extent of poverty in the rural sector declined slightly during the second period of study (2010). Decomposition of changes in poverty into growth and redistribution components indicate that both the growth and the redistribution component were poverty reducing but at different magnitudes indicating that the deterioration of income inequality contributes to the worsening of poverty in Nigeria. Equitable distribution of income and pro-poor growth is thus essential for growth to translate into meaningful and rapid poverty reduction.

Economic-Growth, Rural Poverty, Redistribution, Shapley-Decomposition-Approach

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