Rural Poverty in Honduras: Asset Distribution and Liquidity Constraints

Poverty in Latin America is much more concentrated in rural areas than in urban centers, and Honduras is no exception in this respect (World Bank, 1995e). According to a recent study, Honduras has one of the worst income distributions in Latin America (Londoño, 1995), and one of the lowest per capita incomes in the continent, estimated at US$600. A very high proportion of the farmers in Honduras are below what is considered the extreme poverty line in the region, US$180 annual per capita income. The highly biased income distribution, combined with an extremely low per capita income, makes Honduras one of the worst cases in terms of both the incidence and severity of poverty in all of Latin America.