Role of Human Capital Accumulation in Reducing Poverty and Land Degradation

Abstract

This study examines the role of human capital accumulation in order to escape the poverty-land degradation trap. Moreover, we explore whether the human capital accumulation could lead to reduction in land degradation and poverty. To test this, we have used data of 26 Indian states covering time period 1993–2011 and have employed System-GMM method of estimation to account for the joint endogeneity between the dependent and the explanatory variables. Due to the non-availability of state level poverty data, we have restricted our study to year 2011. To measure poverty, we have used head count ratio, total land degradation as percentage of geographical area is used as a proxy for land degradation, and enrolment in primary classes and 6th to 12th classes is used to measure human capital accumulation. The results suggest that land degradation reduces poverty and increase in poverty increases land degradation. This could be due to the fact that increase in income or reduction in poverty of individual requires the intensification of agriculture production, which contributed to land degradation. We also find that higher educational attainment will reduce poverty. The role of human capital accumulation on land degradation remains unclear.