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Staff Paper No. 549 - Abstract

The Ecological Footprint of Poverty Alleviation: Evidence from Mexico's Oportunidades Program

Jennifer M. Alix-Garcia [alixgarcia@wisc.edu]
Craig McIntosh
Katharine R. E. Sims
Jarrod R. Welch

Staff Paper No. 549, August 2010, 47p.

Abstract

We study the consequences of poverty alleviation programs for environmental degradation. We exploit the community-level eligibility discontinuity for a conditional cash transfer program in Mexico to identify the impacts of income increases on deforestation, and use the program’s initial randomized rollout to explore household responses. We find that additional income increases demand for resource-intensive goods. The corresponding production response and deforestation increase is more detectable in communities with poor road infrastructure. These results are consistent with the idea that better access to markets disperses environmental harm and the full effects of treatment can
only be observed where poor infrastructure localizes them.
Last updated on Mon, Aug 9, 2010 2:54pm