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Do Conflicts Create Poverty Traps? Asset Losses and Recovery for Displaced Households in Colombia

MICROCON Research Working Paper No. 10

58 Pages Posted: 12 Mar 2009  

Andres Moya

Universidad de los Andes

Ana M. Ibáñez

Universidad de los Andes, Colombia - Department of Economics

Date Written: March 6, 2009

Abstract

Internal conflicts entail large asset losses for certain segments in the civilian population. Asset losses may compromise the future welfare of households, thus leaving a legacy of structural poverty that is difficult to overcome. The purpose of this article is to analyze how asset losses occur during internal conflicts and the process of asset accumulation following the initial shock. To do this, we concentrate on a particularly vulnerable group of victims of war-the displaced population in Colombia. In achieving our objective, we adopt quantitative and qualitative approaches by: (i) providing a detailed description of losses stemming from forced displacement; (ii) analyzing qualitative evidence so as to understand the asset recovery processes for the displaced population; and (iii) estimating OLS, Instrumental Variable and quartile regressions in order to identify the determinants of asset losses stemming from forced displacement, and asset accumulation following the initial shock. The results indicate that recuperating asset losses or accumulating new assets is a rare event; only 25 percent of households are able to recover their original asset base, while asset ownership still seems insufficient for overcoming poverty. In addition, displaced households do not catch up even as settlement at destination sites consolidates. Therefore, unless a positive intervention is implemented, displaced households become locked in a low income trajectory, and are unlikely to leap forward to a high return asset level.

Keywords: forced migration, civil conflict, asset losses, structural poverty, quantile regressions

JEL Classification: D74, N46, I32, R23

Suggested Citation

Moya, Andres and Ibáñez, Ana M., Do Conflicts Create Poverty Traps? Asset Losses and Recovery for Displaced Households in Colombia (March 6, 2009). MICROCON Research Working Paper No. 10. Available at SSRN: https://ssrn.com/abstract=1356817 or http://dx.doi.org/10.2139/ssrn.1356817

Andres Moya

Universidad de los Andes ( email )

Carrera Primera # 18A-12
Bogota, D.C. 110311
Colombia
5713394949 (Phone)
13394949 (Fax)

HOME PAGE: http://economia.uniandes.edu.co/moya

Ana María Ibáñez (Contact Author)

Universidad de los Andes, Colombia - Department of Economics ( email )

Carrera 1a No. 18A-10
Santafe de Bogota, AA4976
Colombia
571 339 4949 Ext. 3634 (Phone)

HOME PAGE: http://economia.uniandes.edu.co/~economia/html/profesores/profesores.php?modo=mostrar&id=145

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