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Date: Tue, 19 Apr 94 14:14:03 EDT
Subject: Indigenous People and Poverty in Latin America
Indigenous People and Poverty in Latin America:
An Empirical Analysis
by
George Psacharopoulos
Harry Anthony Patrinos
Abstract
The indigenous people of Latin America live in conditions of extreme
poverty. While this may be common knowledge, this paper represents an
initial attempt at documenting the socioeconomic conditions of indigenous
peoples using empirical data from national survey sources. The nature of
the analysis is microeconomic, using household survey data that include
information on indigenous people defined in terms of ethnic self-perception,
language use and geographical concentration. The countries on which the
analysis is based include Bolivia, Guatemala, Mexico and Peru. The aim is
to empirically investigate the socioeconomic conditions of the indigenous
people of Latin America and to identify the correlates of poverty. This
documentation provides the vital information needed in designing strategies
to target operations and to assist these groups in a poverty reduction
strategy. This report documents that equalization of income-generating
characteristics would boost the productivity of the indigenous population in
their market and non-market activities and lead to a considerable reduction
in inequality and poverty. This suggests that the socioeconomic condition
of indigenous people can be improved since policy-influenced variables such
as education are largely responsible for observed earnings differences.
This unrealized potential provides considerable hope for the future. The
challenge that remains, however, is to devise the means by which to enhance
the human capital endowments of the indigenous population and create the
circumstances by which the indigenous population can derive the maximum
benefit from their productivity-enhancing attributes according to their
individual and collective predisposition.
Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 1
Data and Methodology . . . . . . . . . . . . . . . . . . . . . .. . . 2
Empirical Results. . . . . . . . . . . . . . . . . . . . . . . .. . . 5
Poverty . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 5
Living Conditions . . . . . . . . . . . . . . . . . . . . .. . . 7
Education . . . . . . . . . . . . . . . . . . . . . . . . .. . . 9
Discussion . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 13
Future Research . . . . . . . . . . . . . . . . . . . . . .. . . 16
References . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 20
Introduction
The indigenous people of Latin America live in conditions of extreme
poverty. While this may be common knowledge, this paper represents an
initial attempt at documenting the socioeconomic conditions of indigenous
people using empirical data from national survey sources. The nature of the
analysis is microeconomic, using household survey data that include
information on indigenous people defined in terms of ethnic self-perception,
language use and geographical concentration. The countries on which the
analysis is based include Bolivia, Guatemala, Mexico and Peru. The aim is
to empirically investigate the socioeconomic conditions of the indigenous
people of Latin America and to identify the correlates of poverty. This
documentation provides the vital information needed in designing strategies
to target operations and to assist these groups in a poverty reduction
strategy.
Given that ethnicity is intimately associated with poverty and
disadvantage in many developing countries, and that ethnic inequalities are
affected by public policies toward education, employment, infrastructure,
markets and affirmative action, then an important challenge is to understand
how and how much, and under what circumstances. This is the main purpose of
the present study, the goals of which are: 1) to determine the extent of
poverty among Latin America's indigenous population; and 2) to compare the
socioeconomic conditions of the indigenous population with the
non-indigenous population.
By far the greatest attention paid to the socioeconomic disadvantages
of indigenous people has been by sociologists and economists exploring the
situation of Amerindians in the United States (see, for example, Sandefur
and Scott 1983; Sandefur 1986; Sandefur and Sakamoto 1988; Snipp and
Sandefur 1988; Sandefur et al 1989; Sandefur and Pahari 1989). Much less is
known about indigenous people in other countries, especially in Latin
America.
What is known about the socioeconomic conditions of Latin America's
indigenous people is that they make up a significant portion of the rural
poor. These groups live on the periphery in marginal areas, and are often
landless. In Latin America, indigenous people make up about 27 percent of
the rural population (IFAD 1992). A rural poverty mapping documents that in
11 of 18 cases (countries), the indigenous population is listed among the
main groups of the rural poor (IFAD 1992).
The international literature suggests some priority areas of research
which this study will attempt to undertake. This will include estimation of
the extent of poverty among Latin America's indigenous population. In
addition, the living conditions of the indigenous population will be
compared with those of the non-indigenous population. The basic human
capital differences between the indigenous and non-indigenous population
will also be examined.
Data and Methodology
When conducting research on ethnicity and socioeconomic development,
the problems that must be addressed at the outset include: defining the
target population; deciding which research methodologies to apply; and the
scarcity of data. The approach taken here is empirical economic analysis
using micro-data from household surveys conducted in four Latin American
countries.
While many countries in the region have sizeable indigenous
populations, few include questions to identify the ethnolinguistic
characteristics of individuals in their household or labor force surveys.
Definitions of indigenous people differ from country to country due to the
use of different survey instruments. Given available data, three different
variables identify indigenous respondents: language spoken, self-perception
and geographic concentration. In this analysis, language defines the
indigenous population in Bolivia and Peru. In Bolivia, it is possible to
distinguish between monolingual and bilingual (Spanish and indigenous
language) individuals, while in Peru only monolingual indigenous or Spanish
speakers can be isolated. The Guatemalan study uses the self-identification
or self-perception method of defining the reference population. The
geographic location or concentration of the indigenous population is
generally used when the indigenous population is concentrated in specific
territories, and in combination with questions dealing with self-perception
or language identity. This method is used in order to include Mexico, a
country with a large absolute number of indigenous people.
The poverty analysis includes profiles of the poor, with overall
estimates of poverty rates for the indigenous and non-indigenous
populations. Poverty rates by selected characteristics are presented in an
attempt to better isolate the correlates of poverty. The headcount index of
poverty, the proportion of the population for which income is less than the
poverty line, is estimated.
Definitions of poverty and resulting poverty indicators are numerous,
and substantial disagreement exists on which are more relevant. This study,
however, in its focus on the indigenous dimension, settles on a standard
methodology and attempts to avoid the methodological and theoretical issues
associated with designing a poverty line. In an attempt to analyze the
existence and correlates of absolute poverty, a poverty line, a measure that
separates the poor from the non-poor, is used. Those whose income falls
below the line are poor; those above are non-poor. Following convention,
two poverty lines are used, an "upper" and a "lower" poverty line. These
indicate the boundary between the poor and the very poor, respectively. The
lower poverty line will be referred to as the extreme poverty line.
The country analyses in this study utilize an income-based definition
of poverty, whereby individuals living on a per capita household income
which is less than a given standard are classified as poor. A uniform
poverty line of US$60 per person per month in 1985 purchasing power parity
(PPP) dollars is used. An extreme poverty line of US$30 per person per
month in 1985 PPP dollars is also utilized.
While a profile of the poor is useful and informative, it is based on
only a few categories of the independent variables entering into the
explanation of the poverty measure. For a more thorough investigation of
the determinants of poverty, a multivariate model is used to standardize for
the many factors that simultaneously affect the probability of an individual
being poor. A model is used in an attempt to capture the major determinants
of poverty at the individual level. The model expresses the probability of
being poor as a function of various characteristics such as education,
employment, and being indigenous.
Empirical Results
Poverty
Poverty among Latin America's indigenous population is pervasive and
severe (see Table 1). In Bolivia, while more than half of the total
population is poor, over two-thirds of the bilingual indigenous population
and almost three-quarters of the monolingual indigenous population is poor.
The majority, 66 percent, of the population of Guatemala is poor, with 38
percent of all households below the extreme poverty line. The indigenous
population, however, is disproportionately poor; 87 percent of all
indigenous households are below the poverty line and 61 percent are below
the extreme poverty line.
In Mexico, individuals in "more indigenous" municipios are in poorer
socioeconomic condition than are individuals in less indigenous municipios.
A positive correlation exists between municipio indigenous concentration and
the incidence of poverty. Municipios of increasing indigenous concentration
experience higher percentages of poverty and extreme poverty. In municipios
with a less than 10 percent indigenous population, the poverty headcount
index is 18 percent; in municipios 10 to 40 percent indigenous, 46 percent
of the population is poor; and in municipios over 70 percent indigenous,
over 80 percent of the population is poor.
Table 1: Poverty in Latin America
(percent of population below poverty line)
Indigenous Non-Indigenous
Bolivia 64.3 48.1
Guatemala 86.6 53.9
Mexico 80.6 17.9
Peru 79.0 49.7
Source: Psacharopoulos and Patrinos 1993.
Most of the indigenous population of Peru is poor, at 79 percent,
and more than half is extremely poor. In fact, indigenous people are one
and a half times as likely to be poor than are non-indigenous people, and
almost three times as likely to be extremely poor. Consequently,
indigenous people account for 11 percent of the sample population, yet
they comprise 19 percent of the poor and 27 percent of extremely poor
Peruvians.
The results of a statistical analysis of the determinants of poverty in
Mexico reveals that a one percent increase in the municipio's indigenous
population leads to an increase in the individual's probability of being
poor by approximately one-half of a percentage point. This variable has
considerable impact given the potential range of indigenous population
concentration, 0 to 100 percent. Living in a 50 percent indigenous
municipio increases one's probability of being poor by a substantial 25
percent, marking the greatest possible increase in the marginal probability
of being poor than possible with any other observed factor.
In a similar exercise for Bolivia, it is found that being indigenous
increases the probability of being poor by 16 percent. The probability of
poverty increases by almost 45 percent for household members whose head of
household is unemployed. This suggests that employment is more important
than being indigenous in reducing poverty. Among indigenous heads of
household, participation in the labor force leads to a 40 percent reduction
in the incidence of poverty.
Living Conditions
The living conditions of the indigenous population are generally
abysmal, especially when compared to the non-indigenous population. In
Guatemala, the majority of the population does not have access to such
public services as water, sanitation and electricity. Less than one-third
of all indigenous households have water piped to their homes for their
exclusive use, compared to almost half of non-indigenous households.
Approximately one-half of all indigenous households have no sanitary
services, and three-fourths have no electricity.
In Bolivia, households headed by a non-indigenous person have more
rooms per capita than do households headed by an indigenous person. And
although the indigenous group has a much higher level of home ownership,
this says little about the quality of housing, which is lower for the
indigenous group. This is reflected in the lower rate of sewage facility
connections to indigenous households and the lower prevalence of latrines.
An important finding is the substantially higher prevalence of land
ownership among indigenous people. This could indicate that indigenous
people maintain ties to rural areas, allowing them to maintain already
established support networks.
In the less indigenous areas of Mexico, material possessions such as
televisions, refrigerators and automobiles are more plentiful than in the
more indigenous areas. Services such as piped water, electricity and
telephone service are also more common in less indigenous areas. In
contrast, home ownership is more prevalent in more indigenous areas, but a
closer examination reveals a clear disparity in the physical composition of
homes between more and less indigenous municipios. Homes in less indigenous
areas are built from higher quality materials: 71 percent are constructed
with concrete and brick, while in more indigenous areas only 29 percent are
concrete and brick. A larger percentage of homes in indigenous areas are
built with wood than in less indigenous areas: 21 and 6 percent.
While indigenous people are more likely to own their homes in Peru,
here, too, the physical composition of these homes is consistently deficient
in comparison to that of Spanish- speakers. Of particular importance is the
availability of public water and sanitation facilities. Only 46 percent of
indigenous homes have public water facilities, while 31 percent use wells
and 15 percent use the river as a source of water; only 21 percent of
indigenous homes have public waste disposal. An examination of rural/urban
differences further highlights the indigenous population's deprivation. As
indigenous households are less likely to have a public source of water in
both rural and urban areas, indigenous people are much more likely to obtain
water from wells; 16 percent of urban indigenous households and 39 percent
of rural indigenous households have wells, whereas the corresponding
proportions of Spanish households are only 2 and 10 percent. While the
proportion of rural Spanish households that use rivers as their water source
is larger than in rural indigenous households, the rural prevalence of
indigenous people results in a greater proportion of the indigenous
population being exposed to the diseases associated with poor water
quality. Almost half of all indigenous households rely on kerosene as a
source of light; 88 percent of the homes of Spanish-speakers use
electricity. Within urban areas the use of kerosene is seven times greater
in indigenous homes than in the homes of Spanish-speakers. The relatively
large proportion of urban indigenous households without public water, public
sewage disposal and electricity is evidence of a group of indigenous
squatter settlements in the urban areas.
Education
There is a very strong correlation between schooling attainment and
being indigenous, and between schooling attainment and poverty category. In
Bolivia, the schooling levels of indigenous people are approximately three
years less, on average, than for non-indigenous individuals. The difference
is even greater for indigenous females, suggesting that they are the most
disadvantaged in Bolivian society. In Guatemala, the majority of indigenous
people have no formal education and of those who do, the majority have only
primary education. On average, indigenous people have only 1.3 years of
schooling and only 40 percent are literate.
Access to formal education in Mexico has expanded in recent years, and
improvements have occurred in indigenous areas. Nevertheless, educational
levels remain higher in non- indigenous areas. Illiteracy continues to be
an important problem for some states, especially those which are
predominantly indigenous. The rate of illiteracy increases for both males
and females as municipio indigenous percentages rise. The disparity is
greatest in the female subsample, where the illiteracy rate is more than
four times greater in the "high" indigenous municipio category than in the
"low" indigenous municipio category. In addition, it is interesting to note
that the gender disparity in the illiteracy rate increases as the municipio
indigenous percentage increases. For the least indigenous municipios, the
male/female difference is only 2 percent; but for the "high" indigenous
municipios, the difference is 16 percent, showing a pattern of increasing
male/female educational inequities as municipio indigenous concentration
increases. The higher the proportion of indigenous people in a municipio,
the lower the average level of schooling of its population. Males have
almost 7 years of schooling in those municipios with less than 10 percent
indigenous population, whereas males in those municipios with 40 percent or
more indigenous population have only 3.5 years of schooling.
For the adult population of Peru, the difference between indigenous and
non-indigenous people's educational attainment has narrowed in recent
years. Still, non-indigenous people have 20 percent more education than do
indigenous people. Not only is the indigenous population less educated and
less literate than the Spanish-speaking population, but it also lags behind
the non-indigenous population in terms of training. Differences in
educational levels of indigenous and non-indigenous individuals are
substantial. Only 40 percent of indigenous heads of household have
education in excess of primary school. In contrast, 41 percent of
Spanish-speaking heads of household have some secondary school education,
and 22 percent have some post secondary education. Only six percent of
indigenous heads of household have some post-secondary education.
Educational gaps between the indigenous and non-indigenous populations, as
well as between genders, have been decreasing over time.
The parents' skills and educational attainment are reflected in the
schooling and other human capital characteristics of their children. In
Guatemala, 9 percent of non-indigenous children and 21 percent of indigenous
children are reported as being employed. The children of indigenous origins
are born with many socioeconomic disadvantages and are unable to keep up
with their non-indigenous peers. Indigenous children are more likely to
repeat grades at the primary level and are more likely to drop out of school
altogether.
In Bolivia, non-indigenous children aged six to eighteen years are
still much more likely to be enrolled in school than indigenous children.
Interestingly, the poorer children are actually more likely to be enrolled
than the non-poor children. In terms of years of schooling attainment among
the in-school population, non-indigenous children receive more schooling
than do indigenous children regardless of gender. Multivariate analysis
shows that being indigenous has a strong effect on schooling attainment. In
terms of school enrollment, the participation rate is slightly higher among
males, with a greater percentage of non-indigenous youths attending school
than indigenous youths.
In Peru, 40 percent of non-indigenous children are enrolled in school,
as compared to 36 percent of indigenous children. The effects of language
and rural location are reflected in school attendance. Among the indigenous
population, school attendance is greater among Aymara speakers than it is
among Quechua speakers, and greater still among urban children. School
attendance is also affected by child labor, both in the home and in the
labor market; as hours worked by the child increase, school attendance
decreases. Being indigenous is a major determinant of child work force
participation. Among the indigenous population, Quechua speakers are much
more likely to work than are Aymara speakers. In addition, both parental
employment and education affect the work decision of indigenous children.
Children of less educated parents, children of fathers who are employed as
farmers, and children of mothers who are not in the labor force are more
likely to work.
In Mexico, enrollment rates are higher in non-indigenous areas. The
gap in enrollment rates between indigenous and non-indigenous areas widens
with age, reaching a peak at 17 years, when the non-indigenous enrollment
rate is approximately twice the indigenous rate. Child labor force
participation is greater in indigenous areas than in non-indigenous areas.
This can be partially explained by the rural concentration of the indigenous
population. Parental education plays an important role in average
educational levels among children. The average increase in school
attainment for a child with a mother with secondary or greater education, as
opposed to a mother with no education, is 3.5 years in non-indigenous
areas. Similar differences exist in indigenous areas. Where comparisons
are available, the impact of parental education is greatest in less
indigenous municipios. The employment conditions of the head of the
household also has a clear impact on a child's average educational
attainment. Heads of household who work in non-agricultural pursuits in
either indigenous or non-indigenous areas have children with higher levels
of educational attainment than otherwise employed heads of household. The
contribution of the income of working children to total family income is
substantial. As expected, the contribution of child labor to family income
increases with age, while increasing educational attainment reduces the
contribution. Child income plays a slightly greater role in total family
income in indigenous areas than in non-indigenous areas.
Discussion
There is, fortunately, an unrealized potential. This is evident
throughout Latin America and is highlighted here for the case of Mexico
(Figure 1). The educational level of the population has been increasing
rapidly over the last few decades. The average schooling level of
indigenous males has increased continuously over time. For indigenous
women, the post- 1950s increase is particularly sharp. The statistical
results show that by equalizing human capital characteristics, much of the
income differential between indigenous and non-indigenous people would
disappear. These findings suggest that the socioeconomic condition of
indigenous people in Latin America can be improved since policy-influenced
variables such as education and occupation are largely responsible for
income differences. This provides considerable hope for the future. The
question that remains, however, is how to improve the productive
capabilities of the indigenous population. One obvious solution is to raise
their educational level.
For education projects, knowledge about the indigenous population can
aid in determining the location of new schools, targeting those with poor
performance, and -- when and if appropriate and in demand -- providing
bilingual education. The apparent strong influence of education to
ameliorate poverty and increase income, especially in indigenous areas,
conveys a need to focus on improving access as an important development
issue with significant and beneficial long term socioeconomic
repercussions.
The involvement of indigenous people can aid in the improvement of
the design and implementation of development projects. First, agreement
on what must be done should be reached between the interested parties.
It is necessary to decide on the goals of the intervention from the
outset. Is it reform? And if so, what is meant by reform? In the case
of indigenous people, is the goal assimilation, integration, and the
erasure of indigenous culture? Or the preservation of indigenous culture
through policies designed with the participation of indigenous people?
In the case of education, the lack of meaningful participation by
indigenous people could result in the loss of their culture and language.
Institutional issues associated with the functioning of labor
markets are also important considerations. To some extent, indigenous
people receive lower earnings and have a higher incidence of poverty
because they are locked into the secondary sector of the economy. This
information can aid in the creation of appropriate employment
generation schemes. While many poor and non-poor workers are located in
the informal sector of the economy, it is especially important for the
indigenous poor. This information points to an appropriate sector to
target in any poverty reduction strategy.
The western model of development views traditional cultures as poor, so
that efforts are directed at improving their standard of living. This is
based on the ideology that all cultures must achieve a certain level of
material acquisition in order to be developed. There is the belief that
tribal cultures are unable to satisfy the material needs of their people.
Some argue that all people share a desire for what is defined as material
wealth, prosperity and progress. Others, it is believed, have different
cultures only because they have not yet been exposed to the superior
technological alternatives offered by industrial civilization. The problem
with this reasoning is that the materialistic values of the industrialized
countries of the world are not cultural universals. Indigenous populations
are different, and taking this into account means not imposing non-
indigenous values. Any attempt to improve the conditions of indigenous
populations would benefit from the consideration of "traditional" customs
and expertise.
Future Research
There is a lack of empirical studies regarding the socioeconomic
conditions of Latin America's indigenous population. Important issues to be
tackled include: defining the target population; solving the problem of
scarce data; and designing appropriate research methodologies.
To identify the reference population in this study, it was necessary to
make do with surveys that provide single indicators. However, what is
needed are multiple indicators -- as used in the United States and Canada
census. The whole range of indicators are necessary, including language,
self-identification or self-perception, geographic location or
concentration, ancestry and, possibly, dress (as in the Guatemala 1993
census).
Therefore, what is needed is better data, so that in the future
researchers can undertake more in-depth analyses and include a larger number
of countries. In addition, longitudinal research could be conducted; that
is, an attempt should be made to answer questions such as "What was the
level of discrimination 10, 20, and 30 years ago?" "What will it be 5, 10,
15 years from now?" "What were the effects of past policies and
programs?" "What will be the effects of present policies and programs?"
It may also be useful to study the experiences of developed countries
with indigenous populations. Their treatment of the "indigenous question"
could prove useful, especially in terms of analyzing what these countries
did successfully and what efforts were unsuccessful. The information at
their disposal, as well as how they use it and collect it, could also be
examined.
A future research project on indigenous people could combine the
quantitative approach taken here with qualitative analysis, such as the
participatory-observation research approach. The idea is to combine
comprehensive empirical work with fieldwork and micro-survey techniques.
For example, if it is found that indigenous people in the cities of Bolivia
are working as self-employed individuals who earn less than non-indigenous
individuals with the same level of schooling, then in-depth interviews with
these groups of individuals should be conducted in order to ascertain the
reasons for the income discrepancy. Without this qualitative data, probable
reasons for the discrepancy, including ethnicity, access to training and
cultural values, are merely speculative. Such sophisticated differences are
difficult to assess using only empirical analysis, generally based upon less
than perfect data sets.
Many indigenous people living in urban areas maintain ties with the
rural communities to their mutual advantage. Resources are constantly being
exchanged between town and country. This transfer of resources is important
and not always adequately captured in household survey data. The complex
social networks can only be examined with a qualitative research approach.
An examination of informal safety nets can be accommodated through a
participatory research exercise.
The unpaid but productive activities of indigenous people living and
working in rural communities are often misrepresented as unemployment or
underemployment. Many peasants, however, are often involved in a variety of
activities that provide income, although these are not easily observed,
especially with aggregate household data. Apparently idle peasants are in
most cases heavily involved in many activities, but these are not easily
categorized. This type of information can only be obtained through direct
observation. The information collected, however, can be quantified and
analyzed. This can aid in the design of rural development efforts with
indigenous components.
There is much useful information regarding the manifestations of
poverty that individuals are usually not open to disclosing. This may
include information about their health, sanitation practices, attitudes and
behavior regarding birth control, income or discrimination. A new approach,
therefore, is necessary to supplement conventional sources. Conversational
interviews can be used to ascertain not only the people's income and ability
to pay, but also their values with regard to language, history, and
culture. It may be most effective to involve the target populations in the
design of surveys and projects, and to discuss with target groups the
purpose of these initiatives.
References
International Fund for Agricultural Development (IFAD). 1992.
The State of World Rural Poverty: An Inquiry into Its Causes and
Consequences. New York: New York University Press.
Psacharopoulos, G. and H. A. Patrinos, eds. 1993. Indigenous
People and Poverty in Latin America: An Empirical Analysis. Latin
America and the Caribbean Technical Department, Regional Studies Program,
Report No. 30. Washington, D.C.: The World Bank.
Sandefur, G. D. 1986. "American Indian Migration and Economic
Opportunities." International Migration Review 20: 55-68.
Sandefur, G. D. and A. Pahari. 1989. "Racial and Ethnic Inequality in
Earnings and Educational Attainment." Social Service Review 63: 199-221.
Sandefur, G. D. and A. Sakamoto. 1988. "American Indian Household
Structure and Income." Demography 25: 71-80.
Sandefur, G. D. and W. J. Scott. 1983. "Minority Group Status
and the Wages of Indian and Black Males." Social Science Research
12:44-68.
Snipp, M. and G. D. Sandefur. 1988. "Earnings of American
Indians and Alaskan Natives: The Effects of Residence and Migration."
Social Forces 66: 994-1008.
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Harry Anthony Patrinos
February 1994
I. Conachy
33669