The study has tried to examine the extent of poverty and vulnerability of female–headed households by
way of making comparisons with their male counterparts in urban Ethiopia. It further looks through the
determinants of their welfare and poverty. It is based on the 1999/2000 Household Income, Consumption
and Expenditure Survey (HICES) and Welfare Monitoring Survey (WMS) from Central Statistical
Authority (CSA). Using the Foster, Greer and Thorbecke (FGT) poverty indices, the descriptive analysis
of poverty indices revealed that female-headed households are poorer and more vulnerable to poverty than
male-headed households. To further investigate this, micro level regression models (OLS, probit, ordered
probit and tobit models) have been estimated. And as to the results, the variable indicating gender
suggests that female headship has no significant direct impact on the welfare or poverty level of
households. Rather, other variables such as educational attainment of the head, household size (especially
higher number of children in a family), location of residence in the region, and to some extent
employment status of the head are found to be the key determinants of poverty. However, since FHHs are
more illiterate and unemployed with most of them concentrating in informal sector activities, by
implication the fact that they are female heads has an impact on the welfare or poverty status of the
households indirectly through affecting their level of education and employment status.