Description:
This paper examines the extent to which
social networks among indigenous peoples have a significant
effect on a variety of human capital investment and economic
activities, such as school attendance and work among teenage
boys and girls, and migration, welfare participation,
employment status, occupation and sector of employment among
adult males and females. The analysis uses data from the 10
percent population sample of the 2000 Population and Housing
Census of Mexico and an empirical strategy that allows
taking into account the role of municipality and language
group fixed effects. The authors confirm empirically that
social network effects play an important role in the
economic decisions of indigenous people, especially in rural
areas. The analysis also provides evidence that better
access to basic services, such as water and electricity,
increases the size and strength of network effects in rural areas.