Transport and Poverty in Guatemala: A Profile Using Data from the ENCOVI 2000

Abstract

This paper is the second of a trilogy of papers that measure the impact of roads on poverty in Guatemala. The objective of this study is to construct a detailed and informative poverty-access profile that can simultaneously inform Guatemala’s poverty reduction and rural transport strategies and was undertaken as part of the World Bank’s poverty assessment for the country, and to assess the effect of rural road rehabilitation, undertaken by the World Bank as part of its loan program.

The presence of an extensive household and community level dataset on transport that is linked to a living standards survey at the household level–the ENCOVI 2000 (Encuesta Nacional de Condiciones de Vida or The Living Standard Measurement Survey, LSMS) – presents a rare opportunity. The ENCOVI 2000 was collected by Instituto Nacional de Estadistica (INE), Guatemala, and contains a special module on transport and road construction which highlights its importance in discussions of poverty in the country.

The study examines several topics: First it measures the extent to which basic services are already available in Guatemala. Second it examines the linkages between the provision of transport infrastructure and poverty, vulnerability and exclusion. Third, it measures the extent to which physical access is a limitation in accessing basic services.

Firstly, road quality is a critical bottleneck for economic progress in Guatemala, impacting access to markets, employment and merit services. Lack of road works such as rehabilitation, regular and periodic repair and improvement works (filling up ditches and repairing holes) is integral to the road network of the country. This is especially important because the absence of good quality roads has exacerbated the isolation felt by poor indigenous communities, already deeply impacted by the long civil strife. Problems of road quality are most felt in the north and the north-west which are also amongst the poorest regions of the country.

Secondly the absence of a ‘transitable’ road network has also affected the provision and use of public transport – which is very important in Guatemala, especially because low per capita incomes make private transport infrastructure un-affordable. Women spend 4 hours in some areas just to provide their households with wood. Again, in the north and the north-west, in the absence of motorized transport, policy should be directed towards emphasizing the use of non-motorized transport and building and repairing pedestrian walkways which would make traversing long distances over mountains, easier, for the rural poor.

Thirdly it is clear that the presence of motorable roads is correlated with greater availability of a variety of other services: communication services (phones and post offices) and vulnerability reducing services (such as Banks , Cooperatives, Police stations and Fire Stations). These communities are also less excluded – evident by the relatively lower travel distances to bus stops and other transportation infrastructure. Providing public means of easily available and affordable transportation will play an important role in integrating Guatemala and providing the poor and the indigenous sections of society with a perception of ‘progress’ and inclusion.

This study provides a detailed overview of the correlation between the provision of transport infrastructure and services on one side, and access to other services such as health, education, markets and employment on the other. However one cannot infer causality from cross-tabs and correlation’s. This is because roads are not randomly placed and it is highly likely that factors that have led to road placement, also impact outcomes of interest. Also, impacts of roads are primarily indirect and depend on interactions with other investments, availability of social and physical infrastructure, and, geographic, community and household characteristics. Finally, rarely do roads have only local impacts. For analytical purposes this means that it is difficult to control for heterogeneity of factors that interact with roads to produce impacts associated with roads, since a lot of factors that could help us control heterogeneity, may themselves have been determined by past road investments and networks. These topics are explored in the third paper in these series.

Keywords: Roads, impact, Guatemala, poverty, Living standards measurement survey, Propensity score matching

JEL Classification: C1, C2, D6, H4