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Measuring the Poverty Reduction Potential of Land in Rural Mexico

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Author Info

  • Finan, Frederico
  • Sadoulet, Elisabeth
  • de Janvry, Alain

Abstract

While access to land is back high on the policy agenda as an instrument to attack poverty, strong reservations have been expressed as to whether this strategy can indeed be effective. To help shed light on this important debate, this paper establishes the conditions under which access to land can help reduce poverty in rural communities where poverty is extensive. We use for this purpose household data gathered in 1997 by the Mexican Program for Education, Health, and Nutrition. Results show that access to even a small plot of land can raise household welfare significantly: Using non-parametric regression methods to estimate the relationship between land and welfare, we find that, for small landholders, an additional hectare of land increases welfare on average by 1.3 times the earnings of an agricultural worker. In addition, the marginal welfare value of land depends importantly on a household’s control over complementary assets and on the context where assets are used: For non-indigenous small farmers with at least primary education and access to a road, the welfare benefit of additional land is on average seven times higher than for those without these attributes.

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Bibliographic Info

Paper provided by Department of Agricultural & Resource Economics, UC Berkeley in its series Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series with number qt6xg1q0dg.

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Date of creation: 01 Oct 2002
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Handle: RePEc:cdl:agrebk:qt6xg1q0dg

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Keywords: income; land; rural poverty; welfare economics;

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  1. Carter, Michael R. & Mesbah, Dina, 1993. "Can land market reform mitigate the exclusionary aspects of rapid agro-export growth?," World Development, Elsevier, vol. 21(7), pages 1085-1100, July.
  2. Christiaan Grootaert & Ravi Kanbur & Gi-Taik Oh, 1997. "The dynamics of welfare gains and losses: An African case study," Journal of Development Studies, Taylor & Francis Journals, vol. 33(5), pages 635-657.
  3. Ravallion, Martin, 1996. "Issues in Measuring and Modelling Poverty," Economic Journal, Royal Economic Society, vol. 106(438), pages 1328-43, September.
  4. Julian MAY & Michael R. CARTER, 1997. "Poverty, Livelihood And Class In Rural South Africa," Staff Papers 408, University of Wisconsin Madison, AAE.
  5. Neil McCulloch & Bob Baulch, 2000. "Simulating the impact of policy upon chronic and transitory poverty in rural Pakistan," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 100-130.
  6. Janvry, Alain de & Sadoulet, Elisabeth, 2001. "Income Strategies Among Rural Households in Mexico: The Role of Off-farm Activities," World Development, Elsevier, vol. 29(3), pages 467-480, March.
  7. Binswanger, Hans P. & Deininger, Klaus & Feder, Gershon, 1993. "Power, distortions, revolt, and reform in agricultural land relations," Policy Research Working Paper Series 1164, The World Bank.
  8. Reardon, Thomas & Berdegue, Julio & Escobar, German, 2001. "Rural Nonfarm Employment and Incomes in Latin America: Overview and Policy Implications," World Development, Elsevier, vol. 29(3), pages 395-409, March.
  9. Paul Winters & Alain de Janvry & Elisabeth Sadoulet, 2001. "Family and Community Networks in Mexico-U.S. Migration," Journal of Human Resources, University of Wisconsin Press, vol. 36(1), pages 159-184.
  10. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
  11. Sonia Bhalotra & Cliff Attfield, 1998. "Intrahousehold resource allocation in rural Pakistan: a semiparametric analysis," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 13(5), pages 463-480.
  12. Eswaran, Mukesh & Kotwal, Ashok, 1986. "Access to Capital and Agrarian Production Organisation," Economic Journal, Royal Economic Society, vol. 96(382), pages 482-98, June.
  13. Neil McCulloch & Bob Baulch, 2000. "Simulating the Impact of Policy upon Chronic and Transitory Poverty in Rural Pakistan," Econometrics 0004003, EconWPA.
  14. Robinson, Peter M, 1988. "Root- N-Consistent Semiparametric Regression," Econometrica, Econometric Society, vol. 56(4), pages 931-54, July.
  15. Jan Willem Gunning & John Hoddinott & Bill Kinsey & Trudy Owens, 2000. "Revisiting forever gained: Income dynamics in the resettlement areas of Zimbabwe, 1983-96," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 131-154.
  16. Ravallion, Martin & Sen, Binayak, 1994. "Impacts on rural poverty of land-based targeting: Further results for Bangladesh," World Development, Elsevier, vol. 22(6), pages 823-838, June.
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