scholarly journals Poverty traps across levels of aggregation

2021 ◽  
Author(s):  
Dylan Fitz ◽  
Shyam Gouri Suresh
Keyword(s):  
Market Access ◽  
Institutional Factors ◽  
Poverty Traps ◽  
Poverty Trap ◽  
National Context ◽  
Poverty Dynamics ◽  
Markets And Institutions ◽  
Simulation Results ◽  
Persistent Poverty ◽  
Parsimonious Model

AbstractPoverty trap studies help explain the simultaneous escape from poverty by some households and regions alongside deep and persistent poverty elsewhere. However, researchers remain divided about how important poverty traps are in explaining the range of poverty dynamics observed in various contexts. We build a theoretical model that integrates micro-, meso-, and macro-level poverty traps, allowing us to analyze the ways in which multiple layers of poverty traps interact and reinforce each other. Through this simulation model, markets and institutions arise endogenously and help certain individuals escape poverty, while others remain persistently poor. In addition to one’s own productivity and initial capital levels, we explore how individual opportunity and income can be heavily determined by market access and institutional factors beyond one’s control. Using simulation results from controlled experiments, we can identify the role played by meso- and macro-conditions (that correspond to local markets and country-wide institutions, respectively) in helping individuals escape poverty. Our results suggest that even in a parsimonious model—with optimizing, forward-looking agents operating in a world with only one trap at each level—local and national context matters immensely and combines to determine individual opportunity in complex ways.

Impact of regulatory framework rigidity on poverty in the regions of Russia

2020 ◽  
pp. 62-79
Author(s):  
P. N. Pavlov
Keyword(s):  
Economic Activity ◽  
Regional Level ◽  
Institutional Factors ◽  
Federal Regulations ◽  
Russian Regions ◽  
Poverty Dynamics ◽  
Regulatory Burden ◽  
Sectoral Structure ◽  
The Impact ◽  
Regions Of Russia

The paper analyzes the impact of the federal regulatory burden on poverty dynamics in Russia. The paper provides regional level indices of the federal regulatory burden on the economy in 2008—2018 which take into account sectoral structure of regions’ output and the level of regulatory rigidity of federal regulations governing certain types of economic activity. Estimates of empirical specifications of poverty theoretical model with the inclusion of macroeconomic and institutional factors shows that limiting the scope of the rulemaking activity of government bodies and weakening of new regulations rigidity contributes to a statistically significant reduction in the level of poverty in Russian regions. Cancellation of 10% of accumulated federal level requirements through the “regulatory guillotine” administrative reform may take out of poverty about 1.1—1.4 million people.

POVERTY TRAPS AND INFERIOR GOODS IN A DYNAMIC HECKSCHER–OHLIN MODEL

2012 ◽  
Vol 17 (6) ◽  
pp. 1227-1251 ◽  
Author(s):  
Eric W. Bond ◽  
Kazumichi Iwasa ◽  
Kazuo Nishimura
Keyword(s):  
Economic Theory ◽  
Steady State ◽  
World Economy ◽  
Steady States ◽  
The Other ◽  
Poverty Traps ◽  
Poverty Trap ◽  
Multiple Steady States ◽  
The World ◽  
State Capital

We extend the dynamic Heckscher–Ohlin model in Bond et al. [Economic Theory(48, 171–204, 2011)] and show that if the labor-intensive good is inferior, then there may exist multiple steady states in autarky and poverty traps can arise. Poverty traps for the world economy, in the form of Pareto-dominated steady states, are also shown to exist. We show that the opening of trade can have the effect of pulling the initially poorer country out of a poverty trap, with both countries having steady state capital stocks exceeding the autarky level. However, trade can also pull an initially richer country into a poverty trap. These possibilities are a sharp contrast with dynamic Heckscher–Ohlin models with normality in consumption, where the country with the larger (smaller) capital stock than the other will reach a steady state where the level of welfare is higher (lower) than in the autarkic steady state.

scholarly journals Clusters of poverty and disease emerge from feedbacks on an epidemiological network

2013 ◽  
Vol 10 (80) ◽  
pp. 20120656 ◽  
Author(s):  
Mateusz M. Pluciński ◽  
Calistus N. Ngonghala ◽  
Wayne M. Getz ◽  
Matthew H. Bonds
Keyword(s):  
Economic Growth ◽  
Low Income ◽  
Disease Ecology ◽  
Health Conditions ◽  
Economic Conditions ◽  
Poverty Traps ◽  
Growth Theory ◽  
Poverty Trap ◽  
Localized Disease

The distribution of health conditions is characterized by extreme inequality. These disparities have been alternately attributed to disease ecology and the economics of poverty. Here, we provide a novel framework that integrates epidemiological and economic growth theory on an individual-based hierarchically structured network. Our model indicates that, under certain parameter regimes, feedbacks between disease ecology and economics create clusters of low income and high disease that can stably persist in populations that become otherwise predominantly rich and free of disease. Surprisingly, unlike traditional poverty trap models, these localized disease-driven poverty traps can arise despite homogeneity of parameters and evenly distributed initial economic conditions.

CONFLICTS, CALAMITIES AND NUTRITIONAL POVERTY TRAPS IN A PEASANT ECONOMY: EVIDENCE FROM RURAL CHINA 1929–1933

2019 ◽  
pp. 1-31 ◽  
Author(s):  
LI ZHOU ◽  
JIE SUN ◽  
CALUM GREIG TURVEY
Keyword(s):  
Rural China ◽  
Agricultural Productivity ◽  
Poverty Traps ◽  
Poverty Trap ◽  
Anecdotal Evidence ◽  
Agricultural Economy ◽  
Conflict Zones ◽  
Nutrition Intake ◽  
The Many ◽  
The Impact

This paper uses data compiled by John Lossing Buck from his rural China survey conducted between 1929 and 1933 to analyze the impact of weather calamities and conflict on agricultural productivity, farm wages and nutrition intake. Our results support the conditions required for a Nutritional Poverty Trap (NPT) to be present, while anecdotal evidence points to the potential presence of a nutritional poverty trap for large segments of China’s agricultural economy. We find a lagged effect of climate shock on nutrition, but find no evidence that the many conflicts of the day affected nutrition. This is more likely due to the avoidance of conflict zones by surveyors, but may also support the notion that the effects from conflicts were local and short-lived due to the resilience of farmers.

WHAT HINDERS CROSS-BORDER PORTFOLIO INVESTMENT IN EAST ASIA?

2013 ◽  
Vol 58 (02) ◽  
pp. 1350012 ◽  
Author(s):  
DAEKEUN PARK ◽  
INSEOK SHIN
Keyword(s):  
Market Access ◽  
East Asian ◽  
Explanatory Power ◽  
Institutional Factors ◽  
Portfolio Investment ◽  
Data Set ◽  
Cross Border ◽  
Asian Economies ◽  
Negative Impacts ◽  
East Asian Economies

We examine statistical importance of a number of institutional factors, which have been alleged by market investors and policy commentators as significant barriers on cross-border portfolio investment in East Asian economies, but never been put to empirical tests yet. Taking advantage of the novel data set constructed by the ABMI-GoE, we empirically investigate the explanatory power of such institutional factors as market access-hindering regulations, foreign exchange controls, credit controls, taxation and inefficient post-trading infrastructure. We find that these alleged barriers indeed have significantly negative impacts on cross-border portfolio investment in East Asian economies. In addition, we find some support for the "pecking order" hypothesis in barriers on cross-border portfolio investment in the sense that barriers on post-trading efficiency and cost barriers are not effective unless barriers on market access are significantly lowered.

scholarly journals Do Poverty Traps Exist? Assessing the Evidence

2014 ◽  
Vol 28 (3) ◽  
pp. 127-148 ◽  
Author(s):  
Aart Kraay ◽  
David McKenzie
Keyword(s):  
Work Capacity ◽  
Poverty Traps ◽  
Physical Work ◽  
Poverty Trap ◽  
Physical Work Capacity ◽  
Coordination Failures ◽  
Country Level ◽  
Low Levels ◽  
Underlying Mechanisms ◽  
Big Push

A “poverty trap” can be understood as a set of self-reinforcing mechanisms whereby countries start poor and remain poor: poverty begets poverty, so that current poverty is itself a direct cause of poverty in the future. The idea of a poverty trap has this striking implication for policy: much poverty is needless, in the sense that a different equilibrium is possible and one-time policy efforts to break the poverty trap may have lasting effects. But what does the modern evidence suggest about the extent to which poverty traps exist in practice and the underlying mechanisms that may be involved? The main mechanisms we examine include S-shaped savings functions at the country level; “big-push” theories of development based on coordination failures; hunger-based traps which rely on physical work capacity rising nonlinearly with food intake at low levels; and occupational poverty traps whereby poor individuals who start businesses that are too small will be trapped earning subsistence returns. We conclude that these types of poverty traps are rare and largely limited to remote or otherwise disadvantaged areas. We discuss behavioral poverty traps as a recent area of research, and geographic poverty traps as the most likely form of a trap. The resulting policy prescriptions are quite different from the calls for a big push in aid or an expansion of microfinance. The more-likely poverty traps call for action in less-traditional policy areas such as promoting more migration.

scholarly journals Poverty Traps in the Municipalities of Ecuador: Empirical Evidence

2018 ◽  
Vol 10 (11) ◽  
pp. 4316 ◽  
Author(s):  
Ronny Correa-Quezada ◽  
Diego García-Vélez ◽  
María del Río-Rama ◽  
José Álvarez-García
Keyword(s):  
Empirical Evidence ◽  
Spatial Dependence ◽  
Spatial Association ◽  
Exploratory Analysis ◽  
Vicious Circle ◽  
Poverty Traps ◽  
Poverty Trap ◽  
Spatial Clusters ◽  
Temporal Perspective ◽  
Precarious Situation

The objective of this research is to identify from a spatial and temporal perspective the territories that are located in a “poverty trap” scenario. This is a scenario that does not allow overcoming the conditions and determinants that gave rise to this precarious situation, creating a vicious circle where the conditions of poverty endure through time. The methodology applied is an exploratory analysis of spatial dependence through Moran’s scatterplot and local indicators of spatial association (LISA) maps to visualize the spatial clusters of poverty. The database used is that of the population and housing censuses of 1990, 2001, and 2010 at the cantonal level. The results determine that 73 cantons were in a poverty trap over the period 1990–2001, while from 2001–2010, there were 75 cantons in this situation, which were located mainly in the provinces of Esmeraldas, Manabí, and Loja.

scholarly journals Health safety nets can break cycles of poverty and disease: a stochastic ecological model

2011 ◽  
Vol 8 (65) ◽  
pp. 1796-1803 ◽  
Author(s):  
Mateusz M. Pluciński ◽  
Calistus N. Ngonghala ◽  
Matthew H. Bonds
Keyword(s):  
Stochastic Model ◽  
Deterministic Model ◽  
Initial Conditions ◽  
Basin Of Attraction ◽  
Safety Net ◽  
Poverty Traps ◽  
Poverty Trap ◽  
Theoretical Frameworks ◽  
Deterministic Models ◽  
The Impact

The persistence of extreme poverty is increasingly attributed to dynamic interactions between biophysical processes and economics, though there remains a dearth of integrated theoretical frameworks that can inform policy. Here, we present a stochastic model of disease-driven poverty traps. Whereas deterministic models can result in poverty traps that can only be broken by substantial external changes to the initial conditions, in the stochastic model there is always some probability that a population will leave or enter a poverty trap. We show that a ‘safety net’, defined as an externally enforced minimum level of health or economic conditions, can guarantee ultimate escape from a poverty trap, even if the safety net is set within the basin of attraction of the poverty trap, and even if the safety net is only in the form of a public health measure. Whereas the deterministic model implies that small improvements in initial conditions near the poverty-trap equilibrium are futile, the stochastic model suggests that the impact of changes in the location of the safety net on the rate of development may be strongest near the poverty-trap equilibrium.

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