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Well-Being Dynamics and Poverty Traps

Author

Listed:
  • Christopher B. Barrett

    () (Charles H. Dyson School of Applied Economics and Management, Cornell University, Ithaca, New York 14853)

  • Teevrat Garg

    () (Grantham Research Institute on Climate Change and Environment, London School of Economics, London, WC2A 2AE, United Kingdom
    School of Global Policy and Strategy, University of California, San Diego, La Jolla, California 92093)

  • Linden McBride

    () (Charles H. Dyson School of Applied Economics and Management, Cornell University, Ithaca, New York 14853)

Abstract

A sound understanding of poverty traps—defined as poverty that is self-reinforcing due to the poor's equilibrium behaviors—and their underlying mechanisms is fundamentally important to the development of policies and interventions targeted to assist the poor. We review the theoretical and empirical evidence on single equilibrium and multiple equilibria poverty traps at the macro-, meso-, and, especially, microlevels. In addition we review the literature exploring the various mechanisms that have been posited to perpetuate poverty. We find sufficient evidence to support the poverty traps hypothesis, suggesting that policies designed to interrupt those self-perpetuating mechanisms merit serious attention.

Suggested Citation

  • Christopher B. Barrett & Teevrat Garg & Linden McBride, 2016. "Well-Being Dynamics and Poverty Traps," Annual Review of Resource Economics, Annual Reviews, vol. 8(1), pages 303-327, October.
  • Handle: RePEc:anr:reseco:v:8:y:2016:p:303-327
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    References listed on IDEAS

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    2. Lori Beaman & Jeremy Magruder, 2012. "Who Gets the Job Referral? Evidence from a Social Networks Experiment," American Economic Review, American Economic Association, vol. 102(7), pages 3574-3593, December.
    3. Fogel,Robert William, 2004. "The Escape from Hunger and Premature Death, 1700–2100," Cambridge Books, Cambridge University Press, number 9780521808781, December.
    4. Marianne Bertrand & Sendhil Mullainathan, 2004. "Are Emily and Greg More Employable Than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination," American Economic Review, American Economic Association, vol. 94(4), pages 991-1013, September.
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    12. Feder, Gershon & Just, Richard E & Zilberman, David, 1985. "Adoption of Agricultural Innovations in Developing Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 33(2), pages 255-298, January.
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    Citations

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    Cited by:

    1. Teevrat Garg & Stuart Hamilton & Jacob Hochard & Evan Plous & John Talbot, 2016. "(Not so) Gently down the stream: river pollution and health in Indonesia," GRI Working Papers 234, Grantham Research Institute on Climate Change and the Environment.
    2. Paulo Santos & Christopher B. Barrett, 2017. "Heterogeneous Wealth Dynamics: On the Roles of Risk and Ability," NBER Chapters,in: The Economics of Poverty Traps National Bureau of Economic Research, Inc.
    3. Emma Boswell Dean & Frank Schilbach & Heather Schofield, 2017. "Poverty and Cognitive Function," NBER Chapters,in: The Economics of Poverty Traps National Bureau of Economic Research, Inc.
    4. repec:nbr:nberch:13828 is not listed on IDEAS
    5. Charles D. Brummitt & Kenan Huremovic & Paolo Pin & Matthew H. Bonds & Fernando Vega-Redondo, 2017. "Contagious disruptions and complexity traps in economic development," Papers 1707.05914, arXiv.org.

    More about this item

    Keywords

    chronic poverty; development; market failures; multiple equilibria; safety nets;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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