Using Machine Learning to Predict Poverty Status in Costa Rican Households

Abstract

This study presents two supervised multiclassification machine learning models to predict the poverty status of Costa Rican households as a way to support government and business sectors make decisions in a rapidly changing social and economic environment. Using the Costa Rican household dataset collected via the proxy means test conducted by the Inter-American Development Bank, Random Forest and Gradient Boosted Trees achieved F1 scores of 64.9% and 68.4%, respectively. This study also reveals that education has the greatest impact on predicting poverty status.