Natural resource dependence in rural Mexico

The relationship between poverty and natural resources is complex and the empirical evidence to date, mostly from studies of forest activities and poverty, is inconclusive. The main purpose of this paper is to empirically identify the effects of household characteristics and of inequality at the village level on natural resource extraction and dependence. To do so we use data from the Mexico National Rural Household Survey (ENHRUM). Our results show that in rural Mexico natural resource extraction is predominantly an activity carried out by poor households. The same is true for dependence. We also show that there are important differences across Mexico in terms of both participation and dependence on resource income. These differences are most evident when one compares the south and north of the country. We also show that when relatively rich households participate in resource extraction their natural resource income is considerably higher than that of the poor.