Tenure Security, Human Capital and Soil Conservation in an Overlapping Generation Rural Economy

Abstract

We develop an overlapping generation model of rural agricultural households to examine whether tenure security and subsistence needs influence the choice between unexploited topsoil and investment in children's human capital as the mode of transfer of wealth. A unique dataset from Bangladesh finds that tenure security is associated with greater topsoil conservation and lower human capital investment. Therefore, there exists a tradeoff between these two modes of transfer. We suggest that increased public expenditure on schooling, which substitutes private expenditure, may lower the pressure on land and soil resources.