Development-Induced Displacement and Children's Human Capital

Alison M. Buttenheim, University of California, Los Angeles
Harold Alderman, World Bank Group
Jed Friedman, World Bank Group

Development projects and policies forcibly displace an estimated ten million people each year worldwide. The consequences of forced resettlement can be dire. Cernea’s risk and reconstruction model for displaced populations identifies eight “impoverishment risks,” including food insecurity, increased morbidity, and community disarticulation. In this study we examine how forced resettlement and attendant impoverishment negatively impact children’s human capital. Using a new dataset from the Lao People’s Democratic Republic (Lao PDR), we ask whether children in resettled households achieve lower stature and lower educational attainment than children in non-resettled households. We also evaluate the probable mechanisms linking resettlement to compromised human capital investments in children, including household food security, children’s diet diversity, and time spent on activities other than schooling. We use village fixed-effects models and propensity-score matching techniques to address unobserved heterogeneity in the probability of being displaced. Preliminary results suggest that resettlement does permanently compromise child height.