# **Poverty and Consumption**

We find strong evidence of the negative effect of inflation on household consumption and poverty.<sup>8</sup> The inflation impact is entirely driven by non-food price inflation. Poverty increases with the severity of exposure to inflation by the households. If inflation increases by 1 percent, the share of poor urban population (living below USD 1.90 per day PPP) increases by 0.353 percent. The results also show that the conflict variable is associated with slight decreases in consumption, with a marginal impact on poverty. We also observe that being employed itself does not matter for poverty reduction, probably due to the low urban unemployment rates. Households whose heads are employed in the services sector are less likely to be poor compared to those in the agriculture sector. This probably reflects higher wages for those in the services sector.

Some common findings similar to other poor countries are also observed here: household head being a female, and larger household size are associated with low consumption and the likelihood of being poor. On the other hand, education and land ownership help to reduce poverty. We also run a regression that includes an interaction term between inflation and land ownership. The coefficient on the interaction term is not statistically significant for both food price inflation and non-food price inflation. This suggests that the impact of inflation on poverty and real consumption is the same for both households that do own land and those that do not. Finally, university education increases consumption and reduces poverty. The impact of inflation on real consumption is significantly less for households whose heads do have university education than those who do not (the coefficient on the interaction term is 0.985, p<0.01). No significant differences in education level exist when it comes to the inflation impact on poverty.

# **School Attendance**

About 3 in 4 South Sudanese children were attending primary school in 2015.<sup>9</sup> The primary school attendance rate remained stable in 2016 and increased to 80 percent in 2017 (Figure A3). Secondary school attendance remained stable from 2015 and 2016 at 78 percent but increased to 81 percent in 2017 (Figure A4). Primary school attendance for boys and girls increased at about the same rate between 2015 and 2017 (Figure A5). For the older children, attendance rate for boys declined between 2015 and 2017 by 9 percentage points (Figure A6). The opposite is true for girls’ attendance, which has slightly increased during this period. Perhaps older boys are dropping out of school to join the labor force. This is plausible as children of working age can be expected to join the workforce to help the household support its livelihood during times of economic hardship (World Bank, 2017). However, there is no evidence that this is already happening at a large scale in the states covered by the survey. This is because the difference in school attendance rate of boys aged 14 to 18 between 2015 and 2017 is not significant in a statistical sense.

Food price inflation had a negative and statistically significant impact on girls’ school attendance (but no effect on boys). For girls, the likelihood of attendance diminishes with a rise in food prices. The distance to the nearest school is also important for school attendance. The chances of girls attending school diminish with increases in the distance they would have to walk to the nearest school. We run a regression for girls’ attendance that includes an interaction term between inflation and distance to school. The coefficient on the interaction term is statistically significant and

> 8 The complete difference-in-difference estimates are presented in the appendix (Tables A1-A7). A summary of the regression results of the impact of inflation (β1 coefficients, difference-in difference) is provided in Table 4. 9 Attendance rates for children of primary school age (6-13) and secondary school age (14-18) are reported.

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