The ENIGH data set does not contain any information on ethnic or racial background. Other studies on poverty such as Finan, Sadoulet, and de Janvry (2002) measure the poverty reduction potential of land in rural Mexico using household data gathered in 1997 by the Mexican program for Education, Health, and Nutrition. Their results show for small landholders, an additional hectare of land increases welfare on average by 1.3 times the earnings of an agricultural worker. In addition, the marginal welfare value of land depends importantly on a household's control over complementary assets and on the context where assets are used: For non-indigenous small farmers with at least primary education and access to a road, the welfare benefit of additional land is on average seven times higher than for those without these attributes. Social assets such as ethnicity lower the marginal value of land, whereas households with more education receive a higher return to land. Households that face lower transactions costs as measured by assess to roads, garner a return to land that is two to three times as high as those without access to a road. These findings suggest that land can indeed be an important element of a poverty reduction strategy, but that there are specific conditions that must hold for this to be the case, calling on complementary interventions in Mexico.

Moreover, the ENIGH datasets do not contain any information on ethnic or racial background. Other studies on poverty in Latin America have shown that ethnic or racial background is an important factor contributing to poverty, controlling for other household head characteristics. Mestizos and Indians are two broad ethnic groups based on cultural rather than racial differences cohabiting in Mexico. Each group has a distinct cultural viewpoint and perceives itself as different from the other. At the same time, however, group allegiances may change, making measurement of ethnic composition problematic at best. Originally racial designators the terms _Mestizo_ and _Indian_ have lost almost their entire previous racial connotation and are now used entirely to designate cultural groups.9 Although matzos and indians may both reside in rural areas and have relatively comparable levels of income, they maintain different lives, e.g. Mestizos often argue that Indians are too unmotivated and constrained by tradition to deal appropriately with the demands of modern society. Indians, in turn, frequently argue that mestizos are aggressive, impatient, and disrespectful toward nature.

In 1990, 7.5 percent of the Mexican population, or approximately 5.3 million people above five years of age, spoke an Indian language. Of that total, approximately 79 percent knew Spanish as well and thus were at least potential cultural converts to the mestizo world. Familiarity with indigenous languages increases from north to south: almost no native speakers live in the northeast and north-central part of Mexico, the share climbed to between 10-20 percent in the grouping of states from San Luis Potosí to Guerrero, to 26 percent in Oaxaca, to 32 and 39 percent, respectively, in Quintana Roo and Chiapas, and to 44 percent in Yucatán. Only 63 percent of users of indigenous languages in Chiapas also knew Spanish.

> 9 Historically, the term _mestizo_ described someone with mixed European and indigenous heritage. Mestizos occupied a middle social stratum between whites and pureblooded indigenous people.

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