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Poverty and the Environment-Exploring the Relationship between Household Incomes, Private Assets and Natural Assets

Author

Listed:
  • Urvashi Narain

    (Resources for the Future, Washington DC)

  • Shreekant Gupta

    (Delhi School of Economics)

  • Klaas vant Veld

    (University of Wyoming, Laramie)

Abstract

Using purpose-collected survey data from 535 households in 60 different villages of the Jhabua district of India, this paper investigates the extent to which rural households depend on common-pool natural resources for their daily livelihood. Previous studies have found that resource dependence-- defined as the fraction of total income derived from common-pool resources--strongly decreases with income. Our study uncovers a more complex relationship. Firstly, for the subsample of households that use positive amounts of resources, we find that dependence follows a U-shaped relationship with income, declining at first but then increasing. Secondly, we find that the probability of being in the subsample of common-pool resource users follows an inverse U-shaped relationship with income - the poorest and richest households are less likely to collect resources than those with intermediate incomes. Resource use by the rich is therefore bimodal - either very high or--for the very rich households--zero. Thirdly, we find that resource dependence increases at all income levels with an increase in the level of common-pool biomass availability. The combination of these results suggests that the quality of natural resources matters to a larger share of the rural population than had previously been believed, common-pool resources contribute a significant fraction of the income not just of the desperately poor, but also of the relatively rich.

Suggested Citation

  • Urvashi Narain & Shreekant Gupta & Klaas vant Veld, 2005. "Poverty and the Environment-Exploring the Relationship between Household Incomes, Private Assets and Natural Assets," Working papers 134, Centre for Development Economics, Delhi School of Economics.
    • Handle: RePEc:cde:cdewps:134
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    References listed on IDEAS

    as
    1. Will Cavendish, 1999. "Poverty, inequality and environmental resources: quantitative analysis of rural households," CSAE Working Paper Series 1999-09, Centre for the Study of African Economies, University of Oxford.
    2. Reddy, S. R. C. & Chakravarty, S. P., 1999. "Forest Dependence and Income Distribution in a Subsistence Economy: Evidence from India," World Development, Elsevier, vol. 27(7), pages 1141-1149, July.
    3. Urvashi Narain & Shreekant Gupta & Klaas van ’t Veld, 2008. "Poverty and the Environment: Exploring the Relationship Between Household Incomes, Private Assets, and Natural Assets," Land Economics, University of Wisconsin Press, vol. 84(1), pages 148-167.
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    More about this item

    Keywords

    India; Madhya Pradesh; poverty; environment; common-pool natural resources; rural households;
    All these keywords.

    JEL classification:

    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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