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Assets, Shocks, and Poverty Traps in Rural Mozambique

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  • Giesbert, Lena
  • Schindler, Kati

Abstract

Using a micro-level approach to poverty traps, this paper explores welfare dynamics among households in post-war rural Mozambique. Conceptually, the paper builds on an asset-based approach to poverty and tests empirically, with household panel data, for the existence of a poverty trap. Findings indicate that there is little differentiation in productive asset endow-ments over time and that rural households gravitate towards a single equilibrium, which is at a surprisingly low level. The analysis shows that shocks and household coping behavior help to explain the observed poverty dynamics. The single low-level equilibrium points to an overall development trap in the rural farm-based economy. This is attributed to the long-term impact of the civil war, which has consolidated unfavorable economic conditions in ru-ral areas and limited new economic opportunities outside of the agricultural sector.

Suggested Citation

  • Giesbert, Lena & Schindler, Kati, 2010. "Assets, Shocks, and Poverty Traps in Rural Mozambique," GIGA Working Papers 150, GIGA German Institute of Global and Area Studies.
  • Handle: RePEc:zbw:gigawp:150
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    References listed on IDEAS

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    More about this item

    Keywords

    poverty trap; shocks; asset-based approach; violent conflict; Mozambique;
    All these keywords.

    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
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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