Human capital investment and long-term poverty reduction in rural Mexico
By focusing on human capital investment, the Mexican Oportunidades program will inuence the economic choices of the rural poor. To understand how bene_ciaries may alter their behaviour as a result of this intervention, this paper uses administrative data to analyze the economic activities of the Mexican rural poor. Results indicate that investments in education are likely to shift recipients from agricultural wage employment toward non-farm wage employment. The magnitude of this impact will be inuenced by household assets and by the location of the household. The results suggest the need for policies that complement the government's focus on human capital investment.
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