Determinants of Livelihood Diversification: The Case of Community-Based Ecotourism in Oaxaca, Mexico

Diversification is a livelihood strategy that households use to survive and to absorb disturbances. Community-based ecotourism (CBE) is part of a set of sustainable options that are available to households for diversification. This paper analyses households' capital assets that increase the probability of a family becoming involved in a CBE compared to other forms of diversification, and empirical evidence is presented for coastal communities located in Oaxaca, Mexico. Based on household surveys and a multinomial logit econometric model, the results show that the probability that a household decides to become involved in CBE increases for households with young people and those that have their basic needs covered by government programs or small agricultural production. Other forms of diversification are positively related to agreements within the community, woodfire use, and the presence of irrigated lands. Thus, CBE is determined by specific assets mentioned previously compared to other forms of diversification. Particularly, to promote CBE, tourism policies need to consider households' human, social, natural, and financial capital assets and the associated programs in an integrated way to enhance community development.