Empirical analysis of poverty eradication and its determinants in Rwanda: lessons from China

Abstract

This paper analyzed empirically the lessons Rwanda learned on poverty reduction strategies used by China. The simulations were made using the Fixed Effect Model where the coefficients of explanatory variables were constant or the same for both countries to reflect how poverty reduction strategies used by both countries result in the same outcomes and relatively the same output. Outcomes from simulations revealed that Adjusted Net Saving, government spending, citizen‟s empowerment, education for all and Foreign Direct Investments strategies used and drawn from Chinese economy by Rwanda are statistically significant; hence reduced poverty in both economies. In the light of the findings, the study recommended to policy makers a strong review of their empowerment strategies since it was the only explanatory variable which was not statistically significant in the model. It also recommended that women empowerment in political, social and economic aspects must be accompanied by youths‟ empowerment in those domains as the main driving forces of both economies.