Investments in Human Capital: Long-Term Effects of Progresa- Oportunidades on Poverty and Migration in Rural Mexico

(ProQuest: . denotes formulae omitted.)Poverty has become an intrinsic part of rural Mexico. The Mexican government has followed different strategies in order to palliate the burden of domestic poverty. During World War I, the Mexican authorities and the United States government agreed to send Mexicans to work in the railroad and agricultural fields in the United States. However, the lack of effective coordination and planning contributed to an increasing flow of undocumented immigrants, which raised strong opposition for the continuation of the program from different labor groups (Romo, 1975). By the mid 1930s, the restoration of the ejido system as well as the redistribution of land, during the presidency of Lazaro Cardenas, contributed significantly in the reduction of landless laborers, which declined more than 50 percent from 1934-1940 (Thiesenhunsen, 1996). However, Ibarra Mendivil (1996) argues that Mexican land reform was incomplete since the ejido program remained locked into peasant technologies.In the 1940's the Mexican government embarked again in a joint project with the United States authorities and implemented the "Mexican Farm Labor Program", also known as "Bracero Program. " According to Fennelly (2007), compared to the temporary work program during WWI, the Bracero program was far more effective at alleviating poverty in Mexico. However, like the previous one, this program had the unintended effect of increased undocumented migration. Besides, as pointed by different authors, migration, particularly international migration, has intrinsic social costs such as disrupted families, rapid urbanization, and political tensions (Massey et al., 1993; Massey & Espinosa, 1997; Garza, 1999; William & Massey, 2002; Angelucci, 2005; Rubalcava & Teruel, 2005; Stecklov et al., 2005; Oliver, 2009). Most recently, during of the 1980s, Mexico's government strategy for poverty alleviation consisted basically of domestic efforts rather than new agreements to send Mexican workers to its northern neighbor. Among these, the National Solidarity Program (Pronasol), 1989 - 1994, was an explicit attempt to combat poverty, but ineffective in accomplishing its goal of reaching the poorest. Besides, it was mostly used to strengthen political control of the Institutional Revolutionary Party (PRI) (Levy, 1991; Szekely, 1998; Diaz-Cayeros, Estevez & Magaloni, 2006). It was succeeded in 1997 amid an economic crisis by the Program for Education, Health and Nutrition (Progresa). Among the main differences, Progresa was based on a specific targeting strategy rather than on Pronasol's open and very broad selection of beneficiaries. In addition, Progresa was a more transparent public policy, less likely to be subject to discretionary decisions. It also required co-responsibility.In 2002 the Progresa changed its name to Oportunidades and increased its coverage. By 2005, the program had reached its statutory limit of five million households, but after sixteen years of its implementation in rural areas there is the question of how effective the program has been in breaking up the intergenerational poverty cycle (Escobar Latapi, 2009). When we look at the official poverty measures we can assess the relevance of the problem. From 1996 to 2006, the three official lines registered a general negative trend, meaning a reduction in the number of Mexicans living in poverty (Figure 1). However, since 2008 there has been a constant increase in all lines. The last measures reveal that in 2012 around half of the population in Mexico was living in asset poverty, and near to 20 percent of it was living below the food poverty line.One of the questions explored in this research is the extent to which Progresa-Oportunidades (PO) has alleviated rural poverty. Another is whether there have been unintended effects such as giving incentives to people in rural areas to move to urban areas, creating pockets of poverty there. …