Replication data for: Do Poverty Traps Exist? Assessing the Evidence

Name: Replication data for: Do Poverty Traps Exist? Assessing the Evidence
Published: 2014-09-01
License: This work is licensed under an Other license created by the data depositor. Please refer to the LICENSE file, which should be located alongside the project data and documentation.
Keywords: Poverty traps

Principal Investigator(s): View help for Principal Investigator(s) Aart Kraay; David McKenzie

Version: View help for Version V1

Name	File Type	Size	Last Modified
McKenzieKraayJEPData-appendix			10/27/2021 09:49:AM
LICENSE.txt	text/plain	14.6 KB	10/12/2019 01:56:PM

Project Citation:

Kraay, Aart, and McKenzie, David. Replication data for: Do Poverty Traps Exist? Assessing the Evidence. Nashville, TN: American Economic Association [publisher], 2014. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113928V1

Project Description

Summary: A "poverty trap" can be understood as a set of self-reinforcing mechanisms whereby countries start poor and remain poor: poverty begets poverty, so that current poverty is itself a direct cause of poverty in the future. The idea of a poverty trap has this striking implication for policy: much poverty is needless, in the sense that a different equilibrium is possible and one-time policy efforts to break the poverty trap may have lasting effects. But what does the modern evidence suggest about the extent to which poverty traps exist in practice and the underlying mechanisms that may be involved? The main mechanisms we examine include S-shaped savings functions at the country level; "big-push" theories of development based on coordination failures; hunger-based traps which rely on physical work capacity rising nonlinearly with food intake at low levels; and occupational poverty traps whereby poor individuals who start businesses that are too small will be trapped earning subsistence returns. We conclude that these types of poverty traps are rare and largely limited to remote or otherwise disadvantaged areas. We discuss behavioral poverty traps as a recent area of research, and geographic poverty traps as the most likely form of a trap. The resulting policy prescriptions are quite different from the calls for a big push in aid or an expansion of microfinance. The more-likely poverty traps call for action in less-traditional policy areas such as promoting more migration.

Scope of Project

Subject Terms: Poverty traps

JEL Classification:
      D31 Personal Income, Wealth, and Their Distributions
      I32 Measurement and Analysis of Poverty
      I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
      O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
      R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics

Geographic Coverage: Sri Lanka, World

Time Period(s): 1960 – 2010

Universe: Penn World Table data on GDP for 1960 and 2010 Sri Lanka small firm data on start-up costs for firms

Data Type(s): survey data; observational data

Methodology

Data Source: Penn World Tables Sri Lanka Longitudinal Survey of Enterprises Baseline

Unit(s) of Observation: world level, firm level

Related Publications

Download this project

Published Versions

V1 [2019-10-12]

Export Metadata

Dublin Core

DDI 2.5

Report a Problem

Found a serious problem with the data, such as disclosure risk or copyrighted content? Let us know.

This material is distributed exactly as it arrived from the data depositor. ICPSR has not checked or processed this material. Users should consult the investigator(s) if further information is desired.