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Inspecting the Poverty-Trap Mechanism: A Quantile Regression Approach

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  • Krüger Jens J.

    ()
    (Darmstadt University of Technology)

Abstract

The issue of poverty traps is assessed using quantile regression. An augmentation of the usual convergence regressions by quadratic and cubic terms is used with emphasis on curve fitting rather than parameter estimation. The results show that the generic mechanism leading to poverty traps predominantly applies to countries with relatively low levels of income per capita or per worker that simultaneously have low growth rates in the vicinity and below the lowest quintile of the growth rate distribution. The validity of the results is supported by a nonparametric variant of quantile regression.

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Article provided by De Gruyter in its journal Studies in Nonlinear Dynamics & Econometrics.

Volume (Year): 13 (2009)
Issue (Month): 3 (May)
Pages: 1-18

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Handle: RePEc:bpj:sndecm:v:13:y:2009:i:3:n:2

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  1. Galor, Oded, 2004. "From Stagnation to Growth: Unified Growth Theory," CEPR Discussion Papers 4581, C.E.P.R. Discussion Papers.
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  9. Liu, Zhenjuan & Stengos, Thanasis, 1999. "Non-linearities in Cross-Country Growth Regressions: A Semiparametric Approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(5), pages 527-38, Sept.-Oct.
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