An Article Submitted to
The B.E. Journal of Economic
Analysis & Policy
Manuscript 2291
Village Economies and the Structure
of Extended Family Networks
Manuela Angelucci∗
Giacomo De Giorgi†
Marcos Rangel‡
Imran Rasul∗∗
∗
University of Arizona, angelucm@eller.arizona.edu
Stanford University, degiorgi@stanford.edu
‡
University of Chicago, rangelm@uchicago.edu
∗∗
University College London, i.rasul@ucl.ac.uk
†
c
Copyright 2009
The Berkeley Electronic Press. All rights reserved.
Village Economies and the Structure of
Extended Family Networks∗
Manuela Angelucci, Giacomo De Giorgi, Marcos Rangel, and Imran Rasul
Abstract
This paper documents how the structure of extended family networks in rural Mexico relates to
the poverty and inequality of the village of residence. Using the Hispanic naming convention, we
construct within-village extended family networks in 504 poor rural villages. Family networks are
larger (both in the number of members and as a share of the village population) and out-migration
is lower the poorer and the less unequal the village of residence. Our results are consistent with
the extended family being a source of informal insurance to its members.
KEYWORDS: extended family network, migration, village inequality, village marginality
∗
This research was supported by an IRB approval from the University of Chicago. The paper has
been screened to ensure no confidential information is revealed. We thank the editor, Gary Solon,
and two anonymous referees for suggestions that have helped improve the paper. We also thank
Oriana Bandiera, Martin Browning, John Ermisch, and Alfonso Miranda for useful comments. All
errors remain our own.
Angelucci et al.: Village Economies and Networks
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Angelucci et al.: Village Economies and Networks
Table 1: The Village Economy
Mean, standard deviation in parentheses
Village marginality index
Village inequality index
Village size
(standardized)
(Gini coefficient of household's
permanent income in the village)
(number of households)
-.003
8.34
44.7
(.994)
(1.82)
(29.2)
Minimum Value
-1.97
2.97
6
Maximum Value
2.97
15.8
222
Village Characteristic
Notes: There is one observation for each of the 504 villages.
villages The village marginality index is constructed from information on the share of illiterate
adults in the village, the share of dwellings without water, drainage systems, electricity, and with floors of dirt, the average number of occupants per
room in village households, the share of the population working in the primary sector, distances from other villages, and health and school
infrastructures located in the village. A higher marginality index corresponds to the village being more marginal (poorer). The household welfare index
is a weighted average of household income (excluding children), household size, durables, land and livestock, education, and other physical
characteristics of the dwelling. The index is designed to give relatively greater weight to correlates of permanent income rather than current income. An
increase in the index implies the households is less poor. The measure of village inequality is the Gini coefficient of the welfare index of all households
in the village. This is scaled to lie between 0 and 100. Village size is defined as the number of households in the village. The village marginality index is
standardized across all villages. The villages in the sample cover 7 regions.
Published by The Berkeley Electronic Press, 2009
7
Submission to The B.E. Journal of Economic Analysis & Policy
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Angelucci et al.: Village Economies and Networks
Figure 1: The Village Economy
1
0
-2
-1
Village
index
(mean)marginality
Nloc_mgindex
2
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A: Village Marginality and Inequality
0
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Inequality
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Notes: In each figure, there is one observation at the village level. The village marginality index is constructed from information on the share of
illiterate adults in the village, the share of dwellings without water, drainage systems, electricity, and with floors of dirt, the average number of
occupants per room in village households, the share of the population working in the primary sector, distances from other villages, and health and
school infrastructures located in the village. A higher marginality index corresponds to the village being more marginal (poorer). The household
welfare index is a weighted average of household income (excluding children), household size, durables, land and livestock, education, and other
physical characteristics of the dwelling. The index is designed to give relatively greater weight to correlates of permanent income rather than
current income. An increase in the index implies the households is less poor. The measure of village inequality is the Gini coefficient of the welfare
index of all households in the village. This is scaled to lie between 0 and 100. Village size is defined as the number of households in the village.
The village marginality index is standardized across all villages.
Published by The Berkeley Electronic Press, 2009
9
Submission to The B.E. Journal of Economic Analysis & Policy
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Figure 2: Family Tree
Parents
(F1, f1)
(F2, f2)
Son
(F1, F2)
Spouse
(F3, f3)
Son
(F1, F3)
Spouse
(F7, f7)
Son
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Spouse
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Daughter
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Husband
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Son
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Spouse
(F9, f9)
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(F1, F2)
Husband
(F5, f5)
Son
(F5, F1)
Spouse
(F10, f10)
Daughter
(F5, F1)
Husband
(F11, f11)
Daughter
(F1, F2)
Husband
(F6, f6)
Daughter
(F6, F1)
Husband
(F12, f12)
Notes: We use the convention that the head's surnames are written in standard (black) font, and those of his wife are written in (red) italics. Paternal
surnames are indicated in upper case (F1, F2) and maternal surnames are indicated in lower case (f1, f2). First names are not shown as they are not
relevant for the construction of extended family ties. Each household in the family tree is assumed to be couple headed purely to ease the exposition.
Published by The Berkeley Electronic Press, 2009
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Submission to The B.E. Journal of Economic Analysis & Policy
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Angelucci et al.: Village Economies and Networks
Table 2: The Share of Households With Extended Family Links in the Village, by Type of Link
Mean, standard deviation in parentheses
Inter-generational Family Links
Intra-generational Family Links
Any Family Link
(Connected)
Parents to Son
.781
.164
.085
.178
.087
.452
.285
.262
.230
(.156)
(.100)
(.067)
(.108)
(.068)
(.186)
(.173)
(.150)
(.164)
Minimum
Valuee
Minim m Val
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0
0
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1
.621
.318
.600
.417
.939
.872
.939
.939
Fraction of households in the
village with such a family link
Parents to
Daughter to
Son to Parent
Daughter
Parent
Head to Head Head to Spouse to Spouse to Spouse
(Brothers) Spouse
Head
(Sisters)
Notes: There is one observation for each of the 504 villages. The sample is based on couple headed households that can be tracked over the first and third Progresa waves.
Published by The Berkeley Electronic Press, 2009
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Submission to The B.E. Journal of Economic Analysis & Policy
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Angelucci et al.: Village Economies and Networks
Table 3: The Number of Extended Family Links of Households, by Type of Link
Connected Households
Means, standard deviation between villages in parentheses, standard deviation within villages in brackets
Parents
Father and Mother
From head of household to:
From spouse of household to:
Adult Children
Sons
Daughters
.461
Siblings
All Extended
Family Links
Brothers
Sisters
1.39
.840
3.34
Total Links From
Household
(.094)
.443
.209
(.340)
(.325)
(1.02)
5.23
[.837]
(.399)
(1.95)
[1.87]
[1.52]
[3.92]
(1.53)
.250
[1.44]
[.813]
.910
.725
2.54
[5.47]
(.260)
(1.23)
(.304)
(1.04)
[.656]
[1.71]
[1.51]
[3.89]
Notes: There is one observation per household. The sample is restricted to couple headed households that can be tracked over the first and third Progresa waves that have at least one
extended family member present in the village. An adult child defined is to be at least 17 years old. By construction, the number of links to adult sons and daughters is the same from the
head and spouse. The total links from the household is the sum of unique extended family links from the household to others in the same village, and does not therefore double count the
children of the head and spouse of the household. The decomposition of the standard deviation into that between and within villages takes account of the fact that the number of
households differs in each village.
Published by The Berkeley Electronic Press, 2009
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Figure 3: Family Network Descriptives
0
.05
.1
Density
Fraction
.15
.2
.25
A. Number of Family Networks in the Village
0
5
10
15
loc_net in the village
Number of family networks
20
.3
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.1
Density
Fraction
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0
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Size
of network
Network
Size
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Fraction
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0
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Net_size_id/loc_hh
Number of households in network
/ number of households in village
Notes: Each figure is constructed from those family networks with at least two households in them. Of the baseline sample of 22553 households
that can be tracked over the first and third waves of Progresa, 17030 (75.5%) of them are within family networks with at least two households.
These can be single or couple headed households. There are 2196 family networks in total.
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Angelucci et al.: Village Economies and Networks
Table 4: Extended Family Network Descriptives
Means, standard deviation between villages in parentheses, standard deviation within villages in brackets
Network Size
Network Size/Number of
Households in Village
Average Distance
Mean
7.76
.167
2.12
2.07
2.45
-.001
SD between villages
(9.65)
(.149)
(.303)
(1.20)
(1.18)
(.566)
SD within villages
[11.3]
[.153]
[.545]
[1.19]
[2.11]
[.521]
Degree Diameter
Standardized Household
Welfare Index
Notes: There is one observation per family network so that each network has the same weight irrespective of the number of households within it. The underlying
sample of households is based on couple headed households that can be tracked over the first and third Progresa waves. Of the baseline sample of 22553 couple
headed households, 17030 (75.5%) of them are within family networks with at least two households. There are 2196 family networks in total. The size of the network is
the number of households in the network. Two households that are directly connected are defined to be of distance one to each other. The average distance is the
average over all possible pairs of households within the family network. The diameter of the networks is the longest distance between two households that exists in the
network. The household welfare index is a weighted average of household income (excluding children), household size, durables, land and livestock, education, and
other physical characteristics of the dwelling. The index is designed to give relatively greater weight to correlates of permanent income rather than current income. The
index is calculated relative to a state norm. Hence we standardize the index within each state. An increase in the index implies the households is less poor. The
decomposition of the standard deviation into that between and within villages takes account of the fact that the number of family networks differs in each village.
Published by The Berkeley Electronic Press, 2009
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Submission to The B.E. Journal of Economic Analysis & Policy
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Angelucci et al.: Village Economies and Networks
Figure 4: Family Network Graphs, at Median Village Size
A. Disperse Village
B. Interconnected Village
Notes: The two villages shown in Figures A and B have the same number of households in them. The number of households in each is 36, which
is the median village size in the Progresa data. Each node represents a household. Each link between households correspond either to a
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hand corner of each graph. The figures are generated using UCINET.
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Angelucci et al.: Village Economies and Networks
Table 5: Family Network Structures and the Village Economy
OLS regression estimates, robust standard errors in parentheses
Dependent Variable:
Number of Family
Networks
(1)
Size of the Largest Share of Households in the
Family Network
Largest Family Network
Share of Households
that are Connected
(2)
(3)
(4)
-.374***
1.46**
.027**
-.007
(.117)
(.665)
(.011)
(.007)
.145**
-.558**
-.017**
-.010**
(.059)
(.283)
(.007)
(.004)
.034***
.722***
.003***
.001***
(.007)
(.050)
(.000)
(.000)
Region fixed effects
Yes
Yes
Yes
Yes
R squared
Adjusted R-squared
.189
.749
.154
.125
Observations (village level)
504
504
504
504
Village marginality index
Village inequality index
Village size
Notes: *** denotes significance at 1%, ** at 5%, and * at 10%. There is one observation for each village, and each dependent variable is constructed using
couple headed households that can be tracked over the first and third Progresa waves in each village. The village marginality index is constructed from
information on the share of illiterate adults in the village, the share of dwellings without water, drainage systems, electricity, and with floors of dirt, the average
number of occupants per room in village households, the share of the population working in the primary sector, distances from other villages, and health and
school infrastructures located in the village. A higher marginality index corresponds to the village being more marginal (poorer). The household welfare index is
a weighted average of household income (excluding children), household size, durables, land and livestock, education, and other physical characteristics of
the dwelling. The index is designed to give relatively greater weight to correlates of permanent income rather than current income. An increase in the index
implies the households is less poor. The measure of village inequality is the Gini coefficient of the welfare index of all households in the village. This is scaled
to lie between 0 and 100. Village size is defined as the number of households in the village. The village marginality index is standardized across all villages.
The villages in the sample cover 7 regions. Of the baseline sample of 22553 couple headed households, 17030 (75.5%) of them are within family networks
with at least two households. There are 2196 family networks in total. Robust standard errors are reported.
Published by The Berkeley Electronic Press, 2009
23
Submission to The B.E. Journal of Economic Analysis & Policy
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Submission to The B.E. Journal of Economic Analysis & Policy
Table 6: Extended Family Links and the Village Economy
Columns 1-8: Seemingly Unrelated Regression Estimates
Links to Other Households in the Same Village
Inter-generational Family Links
Dependent Variable:
Son to Parent
Village marginality index
Village inequality index
Village size/100
Intra-generational Family Links
Daughter to Parents to Parents to Head to Head Head to Spouse to
Spouse to
Parent
Son
Daughter
(Brothers) Spouse
Head
Spouse (Sisters)
(1)
(2)
(3)
(4)
.001
.006**
.017***
.018***
(.003)
(.003)
(.003)
(.003)
-.005***
-.004***
-.009***
-.004***
(.002)
(.001)
(.002)
.022***
.046***
.074***
(.007)
(.006)
(.007)
(5)
.004
(6)
(7)
(8)
Network
Characteristic
Local Clustering
Coefficient
(9)
.017***
.021***
.018***
-.024**
(.005)
(.004)
(.004)
(.004)
(.010)
-.021***
-.018***
-.014***
-.017***
.014***
(.001)
(.002)
(.002)
(.002)
(.002)
(.005)
.063***
.133***
.190***
.178***
.171***
-.183***
(.005)
(.009)
(.009)
(.009)
(.008)
(.028)
Household controls
Yes
Region fixed effects
Yes
Yes
18979
15358
Observations (household level)
Yes
Notes: *** denotes significance at 1%, ** at 5%, and * at 10%. The village marginality index is constructed from information on the share of illiterate adults in the village, the share of dwellings without water,
drainage systems, electricity, and with floors of dirt, the average number of occupants per room in village households, the share of the population working in the primary sector, distances from other villages,
and health and school infrastructures located in the village. A higher marginality index corresponds to the village being more marginal (poorer). The household welfare index is a weighted average of
household income (excluding children), household size, durables, land and livestock, education, and other physical characteristics of the dwelling. The index is designed to give relatively greater weight to
correlates of permanent income rather than current income. An increase in the index implies the households is less poor. The measure of village inequality is the Gini coefficient of the welfare index of all
households in the village. This is scaled to lie between 0 and 100. Village size is defined as the number of households in the village. The village marginality index is standardized across all villages. The
villages in the sample cover 7 regions. The following household level characteristics are also controlled for - the husband's age, years of schooling, whether he speaks an indigenous language, and whether
has is currently working, the spouse's age, years of schooling, whether she speaks an indigenous language, and whether she is currently working, the household welfare index, the number of members of the
household, whether the household owns its home, own land, has dirt floors, and has any livestock. In the SUR specification, the Breusch-Pagan test of independence rejects the null hypothesis that the error
terms are uncorrelated in each regression at the 1% significance level. In Column 9 the dependent variable is the local clustering coefficient of the household, and the sample is restricted to households that
are embedded in a family network. The specification is estimated using OLS and robust standard errors clustered by village are calculated.
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26
Angelucci et al.: Village Economies and Networks
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Angelucci et al.: Village Economies and Networks
Table 7: Migration and the Village Economy
Columns 1- 4: Probit Estimates, Marginal Effects Reported
Column 5: OLS Estimates
Robust Standard Errors Reported, Clustered by Village
Permanent Migration
Dependent Variable:
Village marginality index
Village inequality index
Village size/100
p
Mean of dependent
variable
Seasonal Migration
Fertility
Any seasonal migration from Sent remittances
household in last year?
in last year?
Number of children
aged less than 16 in
the household
Any member permanently left in
five years prior to October 1997?
Sent remittances
in last year?
(1)
(2)
(3)
(4)
.015
.017**
.008
.000
(.010)
(.007)
(.020)
(.019)
(.035)
.016***
.011***
-.014
-.011
.077***
(.005)
(.004)
(.009)
(.009)
(.014)
-.000
.000
.001
.000
.052
(.000)
(.000)
(.001)
(.000)
(.072)
.157
.106
.444
.394
2.72
(5)
-.220***
Network controls
Yes
Yes
Yes
Yes
No
Region dummies
Yes
Yes
Yes
Yes
Yes
Observations (network level)
2196
2196
2196
2196
Observations (household level)
18979
Notes: *** denotes significance at 1%, ** at 5%, and * at 10%. In Columns 1 to 4 the unit of analysis the extended family network. In Column 5 the unit of analysis is the household. Robust standard errors are
reported allowing for clustering at the village level. The village marginality index is constructed from information on the share of illiterate adults in the village, the share of dwellings without water, drainage
systems, electricity, and with floors of dirt, the average number of occupants per room in village households, the share of the population working in the primary sector, distances from other villages, and health
and school infrastructures located in the village. A higher marginality index corresponds to the village being more marginal (poorer). The household welfare index is a weighted average of household income
(excluding children), household size, durables, land and livestock, education, and other physical characteristics of the dwelling. The index is designed to give relatively greater weight to correlates of permanent
income rather than current income. An increase in the index implies the households is less poor. The measure of village inequality is the Gini coefficient of the welfare index of all households in the village. This is
scaled to lie between 0 and 100. Village size is defined as the number of households in the village. The village marginality index is standardized across all villages. The villages in the sample cover 7 regions.
The following network level characteristics are also controlled for - the size of the network, the average distance between any two households in the network, the degree of the network, the diameter of the
network, and the average welfare index across households within the network. In Column 5 the dependent variable is the number of children aged 16 or less resident in the baseline. In this specification we do
not control for the total household size.
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31
Submission to The B.E. Journal of Economic Analysis & Policy
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Angelucci et al.: Village Economies and Networks
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Angelucci et al.: Village Economies and Networks
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Published by The Berkeley Electronic Press, 2009
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35
Submission to The B.E. Journal of Economic Analysis & Policy
Table A1: Descriptive Statistics on Surnames, by Surname Type
Mean, standard errors in parentheses, percentages in brackets
Head's Paternal Surname Head's Maternal Surname Spouse's Paternal Surname Spouse's Maternal Surname
(F1)
(f1)
(F2)
(f2)
1696
1996
1912
2025
1064 [62.7]
1188 [59.5]
1088 [56.9]
1100 [54.3]
Number of unique names in the village
15.6
20.1
19.5
20.9
Expected number of same surname matches in population
13.3
11.2
9.92
9.26
(1.66)
(1.36)
(1.25)
(1.19)
Number of surnames
Number [percentage] of surnames mentioned more than once
Expected number of same surname matches in the village
7.55
5.31
5.42
4.98
(.039)
(.036)
(.036)
(.040)
Notes: For the matching probabilities and expected number of same surname matches in the population, the standard errors are clustered by surname for each surname type. The sample is restricted to those households that
can be tracked for the first and third waves of the Progresa data, namely in the baseline survey in October 1997 (wave 1) and the first post program survey in October 1998 (wave 3). There are 22553 such households.
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36
Angelucci et al.: Village Economies and Networks
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Submission to The B.E. Journal of Economic Analysis & Policy
Table A2: The Number of Family Links, by Type of, as Reported in the Mexican Family Life Survey
Couple Headed Households
Mean, standard error in parentheses clustered by village
Outside of the Household (ANY location)
From head of household to:
Parent
Children Aged 0-16
Adult Children
Siblings
All
.476
-
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3.27
4.97
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5.39
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.047
2.02
.571
.019
2.66
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(.039)
(.007)
(.084)
.002
2.02
.571
.009
2.60
(.002)
(.079)
(.039)
(.005)
(.082)
Notes: The sample is taken from the first wave of the Mexican Family Life Survey, 2001. Standard errors are clustered by village. We restrict this sample to the seven Mexican states that are also covered in
the Progresa evaluation data, and to couple headed households, in locations with less than 2500 inhabitants. There are 580 such households. By construction, the number of family links to parental
households is always conditional on two such family links existing. We do not therefore use information on households that have single parents in any location. By construction, the number of children of the
couple inside and outside of the household are identical for the head and the spouse. The number of children outside of the household is restricted to be 17 and older (based on spouses' reports).
http://www.bepress.com/bejeap
38
Angelucci et al.: Village Economies and Networks
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