Abstract:
The major purpose of the study is to investigate the role of governance in poverty reduction in
urban areas of Amhara region. Hence, the study explained about the magnitude of poverty and
investigated the role of governance in poverty reduction. In the analysis, the study used data
from Living Standards Measurement Study-Integrated Surveys on Agriculture (LSMS-ISA) of
2015/16. The Cost of Basic Needs (CBN) approach is used to determine poverty line threshold.
The survey gathered on various socio-economics of urban household in the region. A total of 338
households are included in the survey. Therefore, this study used these sample households as its
target population. Overall, the analysis of this study indicated that household size, household
expenditure, government measurement indicators of government effectiveness, quality of
institutionsignificantly effect on the level of poverty. The magnitude of poverty in the study area
was influenced by sex, education of the household head, household size, household expenditure,
poor institutions and government services. To determine or measure different facets of poverty
(prevalence/incidence, magnitude and intensity) in the sampled households, the FGT approach
used to determine the socio-economic circumstance and determine the magnitude of poverty in
the study area. Finally, the studyprovided recommendation based its findings which could be
used as input in mitigating poverty in the study area.
