Abstract

The national poverty headcount in Chile has declined considerably since 1990. In 2006, rural poverty rate fell below that of urban areas, due in part to population mobility. Rural areas, however, are still characterized by low educational levels and incomes, explained, in part, by low population density, remoteness to services, and limited access to markets for rural-produced products. This study finds that distance (measured as travel time) of rural populations to urban areas is associated with the incidence of poverty in rural communities after controlling for other factors. Using an econometric model based on geographical and socioeconomic information of the Metropolitan Region of Santiago, the study finds that poverty levels in census tracts increase with distance to Santiago, and, for a given distance, access to transportation reduces poverty, through a mitigation of the distance effect.