This paper investigates the link between poverty incidence and geographical conditions
within rural Locations (administrative areas that usually contain several communities) in
Kenya. Evidence from poverty maps for Kenya and other developing countries suggests
that poverty and income distribution are not homogenous, with wide spatial variability. We
use spatial regression techniques to explore the effects of geographic factors on poverty.
The results show mixed effects of geographic variables at national versus provincial levels.
Slope, soil type, distance/travel time to public resources, elevation, type of land use,
demographic and income inequality variables prove to be significant in explaining spatial
patterns of poverty. However, differential influence of these and other factors at the
Location-level shows that Provinces in Kenya are highly heterogeneous; hence different
spatial factors are important in explaining welfare levels in different areas within
Provinces, suggested targeted pro-poor policies are needed. Policy simulations are
conducted to explore the impact of various interventions on Location-level poverty levels.
Investments in roads and improvements in soil fertility both are shown to potentially
reduce poverty rates, with differential impacts in different regions of Kenya.