The Armenia poverty assessment provides a uniquely detailed analysis of household income sources by settlement and by consumption quintile. Although Armenia is not a typical example for ECA as it represents one of the worst economic conditions in the Region, this breakdown is still illustrative. In Armenia in 2001, transfers, especially pensions, comprised 22.7 percent of the incomes of the poorest consumption quintile in Yerevan and 25.5 percent in Other Urban areas, but only 18.6 percent in rural areas. Remittances were also a higher share of incomes of the lowest quintile in Other Urban areas than in the other settlements. In general, residents of the secondary cities showed a wider diversity of income sources than in the capital or in rural areas, where households depended more on labor earnings and farm income, respectively.<sup>26</sup> Since the Other Urban households’ total incomes were below those of their rural and capital city counterparts (both for the poorest and for total households), this income diversity represents coping effort rather than breadth of opportunity.<sup>27</sup>

# **4.1.5. Household expenditure patterns**

The Armenia poverty assessment also provides similar details on household expenditure or consumption patterns. Contrary to what might be expected, the poorest Yerevan households spend both a smaller amount (in drams per month) and smaller share of their total consumption on food (57 percent) than either their secondary city or rural counterparts (who spend 66 and 72 percent, respectively). However, the Yerevan poor spent over twice the share of their consumption on transportation and utilities compared to their counterparts in secondary cities and rural areas, whose shares were similar (4.5 and 4.8 percent, respectively).<sup>28</sup> Qualitative investigations of poverty in Romania find that among the rural populations the exchange of goods and services in kind is more prevalent than cash transactions, which are seen to come at a premium; this pattern was reported much less by urban populations.<sup>29</sup> The same study also found that the rural poor report themselves to be net lenders rather than net borrowers and feel that they benefit thereby because this behavior links them to informal networks of support. The urban poor respondents, however, see themselves as giving up more resources in private transfers than they receive. These alternative claims appear inconsistent, but they might reflect a perception by the urban poor that they are less well connected to reciprocal relationships and that they feel more vulnerable. The urban respondents reported having somewhat less trust in and cooperation with neighbors and others than did the rural respondents.<sup>30</sup>

# **4.2. Non-income dimensions of poverty:  access to infrastructure, energy and housing**

More than a decade of economic and political turmoil in the transition countries has resulted not only in much increased rates of income poverty and inequality, but also in a sharp deterioration in non-income dimensions of poverty. The quality of water, gas, heat, electricity and other infrastructure and energy services, as well as the housing stock, have deteriorated, although this has varied widely among transition countries. Deteriorating services and housing conditions have affected various parts of the population to differing degrees, which has meant some people have little or no access to basic services or live in especially poor housing. Access to services and housing conditions are important non-income dimensions of well being, which will be discussed in this section.

Urban residents, who are concentrated spatially and commonly live in multi-story apartment buildings, have been especially hard hit by the deterioration in infrastructure services. Historically, urban residents

> 26 Armenia: Poverty Assessment, May 29, 2003 draft.  Table 2.20, page 51.

> 27 Ibid, Table II.B.16, p. 18 of Descriptive Statistics annex.

> 28 Ibid., Tables II.B.12, p. 14 and II.B.13, p. 15.

> 29  “Mapped in or Mapped Out? The Romanian Poor in Inter-Household and Community Networks”, p. 20 and table 8a and 8b, appendix 1.

> 30 Ibid, p. 31.

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