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World Bank Document Report No. 31191-GTNo. Report Report No. Guatemala 31191-GT Growth of SustainableRural Drivers Guatemala Drivers of Sustainable Rural Growth and Poverty Reduction in Central America Public Disclosure Authorized Public Disclosure Authorized Guatemala Case Study (In Two Volumes) Volume I: Executive Summary and Main Text December 31, 2004 Department of Environmentally and Socially Sustainable Development Latin America and the Caribbean Region Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized and Poverty Reduction in Central America Volume I America Volume Reduction in Central and Poverty Document of the World Bank Public Disclosure Authorized Public Disclosure Authorized Table of Contents VOLUME I Abbreviations and Acronyms ............................................................................................. ii Acknowledgements........................................................................................................... vii Foreword..........................................................................................................................viii Executive Summary............................................................................................................ ix 1. Introduction................................................................................................................1 2. Characterization of the Guatemalan Rural Economy and Policy Directions............. 8 3. Spatial Analysis of Rural Guatemala....................................................................... 16 4. Summary of Multivariate and Qualitative Household-level Analyses .................... 36 5. Conclusions and Recommendations ........................................................................ 51 References......................................................................................................................... 57 Boxes 2.1. Indigenous Groups: A History of Exclusion and Repression .................................... 9 2.2. The 1996 Peace Accords.......................................................................................... 10 3.1. Internal Mobility and Population Change................................................................ 23 4.1. Quantitative Household Analysis ............................................................................ 36 4.2. Livelihood Studies and Participatory Assessments ................................................. 38 4.3. Migration as a Livelihood Strategy.......................................................................... 38 4.4. The Role of Education ............................................................................................. 42 4.5. Simulation of Improvements in Dirt Roads versus Paved Roads............................ 44 4.6. The Role of Electricity and Other Productive Infrastructure................................... 45 4.7. Social Capital in Guatemala..................................................................................... 46 Tables 2.1. Selected Data for Central American Countries, 2000................................................ 8 2.2. Population and Poverty, by Ethnic Group and Household Headship ........................ 9 2.3. Area and Production of Major Crops, 1990—2001................................................. 11 2.4. Value of Agricultural Exports and Imports (US $000)............................................ 12 2.5. Terms of Trade, 1994--2003 ((FOB/FOB, 1997 = 100) .......................................... 12 2.6. Select Indicators for the Coffee Sector, 2000 .......................................................... 12 3.1. Population and Poverty Rates by Region................................................................. 18 3.2. Key Assets and Measures of Well-being, All Rural Households ............................ 29 3.3. Percentage Difference in Well-being....................................................................... 30 3.4. Assets by Region, Rural Guatemala ........................................................................ 32 4.1. Social Capital Participation by Household Poverty Status...................................... 47 4.2. Disaggregated Social Capital Participation, by Region........................................... 48 iii Figures 1.1. The Asset-based Approach ........................................................................................ 7 3.1. Guatemala's Regions and Departments.................................................................... 17 3.2. Roads, Urban Centers, and Population Densities .................................................... 19 3.3. Agricultural Land Use.............................................................................................. 20 3.4. Population-adjusted Road Densities ........................................................................ 21 3.5. Population Change, 1994--2002 .............................................................................. 22 3.6. Agricultural Potential............................................................................................... 25 3.7. Economic Potential .................................................................................................. 26 3.8. Differences in Density of Well-being, by Region ................................................... 27 3.9. Extreme Poverty Rates by Municipio...................................................................... 31 3.10. Poverty Densities ..................................................................................................... 34 4.1. Differences in Density of Well-being Attributable to Education of Household Head ......................................................................................................................... 40 4.2. Differences in Density of Well-being for Households Headed by Someone with only Primary School Education, by Region of Residence....................................... 41 iv VOLUME II Abbreviations and Acronyms .............................................................................................ii Appendixes 1. Using an Asset-Based Approach to Identify Drivers of Sustainable Rural Growth and Poverty Reduction in Central America: Conceptual Framework ....................... 1 2. Spatial Analysis of Rural Economic Growth Potential in Guatemala ..................... 25 3. Household-level Analysis of Well-being in Rural Guatemala ................................ 55 4. Guatemala Rapid Asset and Livelihood Participatory Assessment....................... 109 Boxes 1.1. Sectoral and Spatial Linkages................................................................................... 5 1.2. The Mystery of Assets .............................................................................................. 8 1.3. Why the Poor are Poor: Lack of Assets and Low Asset Productivity ..................... 9 1.4. Defining a Livelihood............................................................................................. 10 3.1. Endogeneity and Causality in the Regressions ....................................................... 61 4.1. Social Capital: Groups and Organizations............................................................ 117 4.2. Can Plant and Animal Health Promoters be Patterned after Health Promoters?.. 120 4.3. Women's Well-being: Perceptions of Improvements Since the Peace Accords... 122 Tables 1.1. Toward a New Rural Development Strategy for Central America......................... 21 1.2. Household-Level Assets and Links to Other Levels............................................... 22 2.1. Population change by Region and Department, 1994-2002 ................................... 36 2.2. Determinants of Municipio-level Changes in Population....................................... 37 2.3. Characterization of Agricultural Regions of Guatemala ........................................ 38 2.4. Method Used to Produce Map of Zones of Economic Potential ............................ 40 3.1. Variables in Analysis. Key Assets and Measures of Well-being, all Rural Guatemala, by Poverty Status............................................................................... 80 3.2. Assets by Region, Rural Guatemala ....................................................................... 80 3.3. Outcomes and Strategies by Region ....................................................................... 81 3.4. Regression of Well-being on Basic Assets, all Rural Households ......................... 82 3.5. Mean and Median (quantile) Regression of Well-being on Basic Assets, by Region............................................................................................................... 83 3.6. Regression of Well-being on Basic Assets and Employment Strategies, by Region................................................................................................................ 85 3.7. Oaxaca Decomposition of Mean Differences in Well-being.................................. 88 3.8. Oaxaca Decomposition of Mean Differences in Well-being by Asset................... 89 v 3.9. Distribution of Households by Head’s Education, by Urban-Rural ....................... 90 3.10. Indicators of Rural Well-being by Household Livelihood Strategy ....................... 91 3.11. Indicators of Well-being by Primary Source of Household Income....................... 92 3.12. Description of Livelihood Strategies in Structural Model...................................... 93
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