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Does natural resource extraction mitigate poverty and inequality? Evidence from rural Mexico and a Lacandona Rainforest Community

Published online by Cambridge University Press:  14 March 2007

ALEJANDRO LÓPEZ-FELDMAN ,
JORGE MORA  and
J. EDWARD TAYLOR
ALEJANDRO LÓPEZ-FELDMAN
Affiliation:
Escuela de Economía, Universidad de Guanajuato, Ucea-Campus Marfil, Guanajuato, Mexico 36250. Tel: 52-473-735-2925. Fax: 52-473-2976. Email: lopezfeldman@ugto.mx
JORGE MORA
Affiliation:
Centro de Estudios Económicos, El Colegio de México, Camino al Ajusco 20, Pedregal de Santa Teresa, D.F. Mexico. 10740. Tel: 555-449-3000. Fax: 555-645-0464. Email: jmora@colmex.mx
J. EDWARD TAYLOR
Affiliation:
Department of Agricultural and Resource Economics, University of California, Davis, One Shields Avenue, Davis, California 95616. Tel: 530-752-0213. Fax: 530-752-5614. Email: taylor@primal.ucdavis.edu
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Abstract

The potential importance of natural resources for the livelihood of poor rural households has long been recognized but seldom quantified and analyzed. In this paper, we apply poverty and inequality measures to national and community level data sets to explore the impacts of resource extraction on rural welfare. Our findings suggest that natural resource extraction reduces both income inequality and poverty. Results from a simulation analysis at the community level indicate that poverty may be reduced, in the short-run, by increases in the price of a non-timber forest product.

Type
Research Article
Information
Environment and Development Economics , Volume 12 , Issue 2 , April 2007 , pp. 251 - 269
Copyright
© 2007 Cambridge University Press

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Footnotes

Critical financial support was provided at various stages of this research by the William and Flora Hewlett Foundation, the Fulbright program, Mexico's Consejo Nacional de Ciencia y Tecnología (CONACYT), the US Department of Agriculture (USDA/NRI), the University of California Institute forMexico and the United States (UCMEXUS) and the Institute of International Education's Programa Regional de Becas de Posgrado en Ciencias Sociales (funded by the Ford Foundation, the William and Flora Hewlett Foundations and the MacArthur Foundation). The authors acknowledge helpful comments from two anonymous referees of this journal.