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A Class of Poverty Traps: A Theory and Empirical Tests

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  • Alan Martina

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    Abstract

    Comparatively low levels of health and economic institutions are present in certain countries and not in others. Implications drawn from this observation are used to modify the Solow-Swan economic growth model. Conjectures are derived from the resulting model concerning what circumstances are likely to generate a health-only poverty trap and a health-cum-institutions poverty trap. These conjectures are tested through the use of quasi-controlled experimental evidence and econometric tests based on cross-country data sets. These tests support the conjecture that this class of poverty traps exists. Certain implications follow regarding the broad design of development policy.

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    Paper provided by Australian National University, College of Business and Economics, School of Economics in its series ANU Working Papers in Economics and Econometrics with number 2007-482.

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    Length: 125 pages
    Date of creation: Jul 2007
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    Handle: RePEc:acb:cbeeco:2007-482

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