New Economics Papers
on Central and South America
Issue of 2009‒03‒22
two papers chosen by

  1. Do conflicts create poverty traps? Asset losses and recovery for displaced households in Colombia By Ana María Ibáñez; Andrés Moya
  2. Subjective well-being and basic needs: Evidence from rural Guatemala By Jorge Guardiola; Teresa Garcia-Muñoz

  1. By: Ana María Ibáñez (Department of Economics, Universidad de los Andes); Andrés Moya (University of Wisconsin, Madison)
    Abstract: Internal conflicts entail large asset losses for certain segments in the civilian population. Asset losses may compromise the future welfare of households, thus leaving a legacy of structural poverty that is difficult to overcome. The purpose of this article is to analyze how asset losses occur during internal conflicts and the process of asset accumulation following the initial shock. To do this, we concentrate on a particularly vulnerable group of victims of war—the displaced population in Colombia. In achieving our objective, we adopt quantitative and qualitative approaches by: (i) providing a detailed description of losses stemming from forced displacement; (ii) analyzing qualitative evidence so as to understand the asset recovery processes for the displaced population; and (iii) estimating OLS, Instrumental Variable and quartile regressions in order to identify the determinants of asset losses stemming from forced displacement, and asset accumulation following the initial shock. The results indicate that recuperating asset losses or accumulating new assets is a rare event; only 25 percent of households are able to recover their original asset base, while asset ownership still seems insufficient for overcoming poverty. In addition, displaced households do not catch up even as settlement at destination sites consolidates. Therefore, unless a positive intervention is implemented, displaced households become locked in a low income trajectory, and are unlikely to leap forward to a high return asset level.
    Keywords: Forced migration, civil conflict, asset losses, structural poverty, quantile regressions
    JEL: D74 N46 I32 R23
    Date: 2009
  2. By: Jorge Guardiola (Department of Applied Economics, University of Granada.); Teresa Garcia-Muñoz (Department of Quantitative Methods fo Economics and Management, University of Granada.)
    Abstract: This paper deals with basic needs fulfillment interpreted in a subjective way. We develop a framework in which the basic needs of households in developing areas are valued from a subjective point of view. We estimate how certain indicators and assets influence basic needs perception. We compare income and perceived basic needs poverty measures, finding that they mismatch. We conclude that income-based approaches should be complemented with other indicators such as subjective satisfaction measures to understand development and measure poverty.
    Keywords: Subjective well-being, basic needs, poverty, Guatemala, Highlands.
    JEL: I31 I32 O13 O18
    Date: 2009–02–15

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