Ethnicity, Language, and Economic Well-Being in Rural Guatemala

We examine ethnic differences in objective and perceived economic well-being in rural Guatemala. The evidence shows that long-standing ethnic differentials in objective indicators of household economic well-being actually widened between 1988 and 1995, a period characterized by rapid economic growth rates. We examine the effects of a major determinant of household economic well-being in rural Guatemala, educational attainment, in accounting for ethnic and language differentials in household consumption. Our results show that returns to education appears to be substantially lower for Indigenous households, especially Indigenous households where the head of household does not speak Spanish. Ethnic differentials in perceived economic well-being do not strictly parallel differences in objective indicators of well-being. Indigenous women with any education are more likely to report relative economic deprivation than are nonIndigenous women, or ladinas, controlling for objective measures of household wealth. *Acknowledgments: This work has been support by the Demographic and Behavioural Sciences Branch of the National Institute of Child Health and Human Development under grant R01 HD27361 and the Demography and Epidemiology Unit of the Behavioural and Social Research Program of the National Institute on Aging, under grant number I T32 AG00244-03. The authors are grateful to Mary Arends, Kathleen Beegle, and Noreen Goldman for their useful comments and suggestions.