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Poverty, voracity, and growth

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  • Strulik, Holger

Abstract

This article investigates economic performance when enforceable property rights are missing and basic needs matter for consumption. It suggests a new view of the so-called voracity effect according to which windfall gains in productivity induce behavior that leads to lower economic growth. Taking into account that the rate of intertemporal substitution in consumption depends on the level of consumption, it is shown that “voracious behavior” is situation-specific. It occurs when an economy is in decline and sufficiently close to stagnation.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Development Economics.

Volume (Year): 97 (2012)
Issue (Month): 2 ()
Pages: 396-403

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Handle: RePEc:eee:deveco:v:97:y:2012:i:2:p:396-403

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Web page: http://www.elsevier.com/locate/devec

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Keywords: Economic growth; Property rights; Common pool resources; Voracity; Fractionalization;

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Cited by:
  1. Tenryu, Yohei, 2013. "The Role of the Private Sector under Insecure Property Rights," MPRA Paper 50727, University Library of Munich, Germany.
  2. Strulik, Holger, 2012. "The voracity effect revisited," Mathematical Social Sciences, Elsevier, Elsevier, vol. 64(3), pages 272-276.
  3. Yohei Tenryu, 2013. "Interest in Private Assets and the Voracity Effect," KIER Working Papers 850, Kyoto University, Institute of Economic Research.

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