Fractal Poverty Traps

This paper offers an informal theory of a special sort of poverty trap, one in which multiple dynamic equilibria exist simultaneously at multiple (micro, meso and/or macro) scales of analysis and are self-reinforcing through feedback effects. Small adjustments at any one of these levels are unlikely to move the system away from its dominant, stable dynamic equilibrium. Governments, markets and communities are simultaneously weak in places characterized by fractal poverty traps. No unit operates at a high-level equilibrium in such a system. All seem simultaneously trapped in low-level equilibria. The fractal poverty traps formulation suggests four interrelated strategic emphases for poverty reduction strategies.

[1]  J. Okidi,et al.  An Overview of Chronic Poverty and Development Policy in Uganda , 2002 .

[2]  A. Venables,et al.  The Spatial Economy: Cities, Regions, and International Trade , 1999 .

[3]  I. Scoones.  Sustainable Rural Livelihoods: A Framework for Analysis , 1998 .

[4]  Jean-Philippe Platteau,et al.  Institutions, Social Norms and Economic Development , 2000 .

[5]  Martin Ravallion,et al.  Geographic poverty traps? A micro model of consumption growth in rural China , 2002 .

[6]  Timothy Besley,et al.  Savings, credit and insurance , 1995 .

[7]  David L. Dollar.  Outward-Oriented Developing Economies Really Do Grow More Rapidly: Evidence from 95 LDCs, 1976-1985 , 1992, Economic Development and Cultural Change.

[8]  S. W. Omamo.  Transport Costs and Smallholder Cropping Choices: An Application to Siaya District, Kenya , 1998 .

[9]  Allan Drazen,et al.  Threshold Externalities in Economic Development , 1990 .

[10]  C. Barrett,et al.  Agricultural Technology, Productivity, Poverty and Food Security in Madagascar , 2005 .

[11]  E. Ostrom,et al.  COLLECTIVE ACTION , PROPERTY RIGHTS , AND DEVOLUTION OF FOREST AND PROTECTED AREA MANAGEMENT , 1999 .

[12]  D. Hulme,et al.  Conceptualizing Chronic Poverty , 2003 .

[13]  S. Dercon,et al.  In Sickness and in Health: Risk Sharing within Households in Rural Ethiopia , 2000, Journal of Political Economy.

[14]  B. Mandelbrot,et al.  Fractals: Form, Chance and Dimension , 1978 .

[15]  Stefan Dercon,et al.  Growth and shocks: evidence from rural Ethiopia , 2004 .

[16]  DeeVon Bailey,et al.  Livestock Pricing In The Northern Kenyan Rangelands , 2003 .

[17]  Bob Baulch,et al.  Economic mobility and poverty dynamics in developing countries , 2000 .

[18]  J. Gunning,et al.  Convergence, Shocks and Poverty , 2002 .

[19]  Debraj Ray,et al.  Contractual Structure and Wealth Accumulation , 2002 .

[20]  A. Banerjee,et al.  Occupational Choice and the Process of Development , 1993, Journal of Political Economy.

[21]  E. Thorbecke,et al.  A Class of Decomposable Poverty Measures , 1984 .

[22]  Martin Ravallion,et al.  Household Income Dynamics in Rural China , 2001 .

[23]  K. Simler,et al.  Are neighbours equal? : estimating local inequality in three developing countries , 2003 .

[24]  D. Hulme,et al.  Chronic Poverty and Remote Rural Areas, CPRC Working Paper No. 13 , 2002 .

[25]  F. Ellis.  Rural Livelihoods and Diversity in Developing Countries , 2000 .

[26]  Benoit B. Mandelbrot,et al.  Fractal Geometry of Nature , 1984 .

[27]  Rui Benfica,et al.  Policy Synthesis for Cooperating Usaid Offices and Country Missions Smallholder Income and Land Distribution in Africa: Implications for Poverty Reduction Strategies , 2022 .

[28]  M. Ravallion.  Externalities in Rural Development: Evidence for China , 2002 .

[29]  James A. Robinson,et al.  The Colonial Origins of Comparative Development: An Empirical Investigation , 2000 .

[30]  G. Myrdal.  Economic theory and under-developed regions , 1960 .

[31]  Julian May,et al.  Poverty, livelihood and class in rural South Africa , 1997 .

[32]  Glenn C. Loury,et al.  Intergenerational Transfers and the Distribution of Earnings , 1981 .

[33]  H. Gintis,et al.  Wealth Inequality, Wealth Constraints and Economic Performance , 1998 .

[34]  J. Sachs,et al.  Natural Resource Abundance and Economic Growth , 1995 .

[35]  Julian May,et al.  One Kind of Freedom: Poverty Dynamics in Post-apartheid South Africa , 2001 .

[36]  W. Easterly,et al.  Africa's Growth Tragedy: Policies and Ethnic Divisions , 1997 .

[37]  Travis J. Lybbert,et al.  Stochastic Wealth Dynamics and Risk Management Among a Poor Population , 2002 .

[38]  M. Lokshin,et al.  Household Income Dynamics in Two Transition Economies , 2004 .

[39]  C. Barrett.  Urban Bias in Price Risk: The Geography of Food Price Distributions in Low-Income Economies , 1996 .

[40]  C. Barrett,et al.  Income diversification, poverty traps and policy shocks in Côte d’Ivoire and Kenya , 2001 .

[41]  W. Oates,et al.  An Essay on Fiscal Federalism , 1999 .

[42]  A. Garg,et al.  On Kin Groups and Wages in the Ghanaian Labour Market , 1999 .

[43]  J. Sachs,et al.  Sources of Slow Growth in African Economies , 1997 .

[44]  R. Hinde,et al.  Governing the Commons: The Evolution of Institutions for Governing the Commons: The Evolution of Institutions for Collective Action Collective Action , 2010 .

[45]  S. Durlauf.  The memberships theory of poverty : the role of group affiliations in determining socioeconomic outcomes , 2000 .

[46]  Un Millennium,et al.  Investing in development : a practical plan to achieve the Millennium Development Goals , 2005 .

[47]  Simon Johnson,et al.  Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution , 2001 .

[48]  R. Meinzen-Dick,et al.  Collective action, property rights, and devolution of natural resource management: exchange of knowledge and implications for policy , 2000 .

[49]  Christopher B. Barrett,et al.  Rural poverty dynamics: development policy implications , 2003 .

[50]  W. Baumol.  Productivity Growth, Convergence, and Welfare: What the Long-run Data Show , 1985 .

[51]  A. Venables,et al.  The Spatial Economy: Cities, Regions, and International Trade , 2000 .

[52]  J. Morduch.  The microfinance promise , 1999 .

[53]  A. Krishna.  Moving from the Stock of Social Capital to the Flow of Benefits: The Role of Agency , 2001 .

[54]  S. Vosti,et al.  Links between rural poverty and the environment in developing countries: Asset categories and investment poverty , 1995 .

[55]  O. Coomes,et al.  Indigenous market-oriented agroforestry: dissecting local diversity in western Amazonia , 1997, Agroforestry Systems.

[56]  O. Coomes,et al.  Tropical forests and shifting cultivation: secondary forest fallow dynamics among traditional farmers of the Peruvian Amazon , 2000 .

[57]  A. Deaton,et al.  Household Saving in LDCs: Credit Markets, Insurance and Welfare , 1992 .

[58]  R. Lucas.  On the Mechanics of Economic Development , 1988 .

[59]  Pranab Bardhan,et al.  Journal of Economic Perspectives—Volume 16, Number 4—Fall 2002—Pages 185–205 Decentralization of Governance and Development , 2022 .

[60]  E. Rogers.  Diffusion of Innovations , 1962 .

[61]  John S. Strauss,et al.  Health nutrition and economic development. , 1998 .

[62]  M. Porter.  The Competitive Advantage Of Nations , 1990 .

[63]  C. Barrett,et al.  Natural resources management in African agriculture: understanding and improving current practices. , 2002 .

[64]  Bart Minten,et al.  Returns to Social Network Capital Among Traders , 2002 .

[65]  E. Aryeetey,et al.  Financial Integration and Development: Liberalization and Reform in Sub-Saharan Africa , 1998 .

[66]  C. Barrett.  On Social Networks and Economic Development , 2003 .

[67]  Joseph Zeira,et al.  Income Distribution and Macroeconomics , 1988 .

[68]  K. Shepherd,et al.  Soil fertility management in west Kenya: dynamic simulation of productivity, profitability and sustainability at different resource endowment levels , 1998 .

[69]  P. N. Rosenstein-Rodan,et al.  Problems of Industrialisation of Eastern and South-Eastern Europe , 1943 .

[70]  M. Lipton,et al.  Why poor people stay poor , 1976 .

[71]  C. Barrett,et al.  The economics of poverty traps and persistent poverty: An asset-based approach , 2006 .

[72]  Christopher B. Barrett,et al.  FOOD SECURITY AND FOOD ASSISTANCE PROGRAMS , 2001 .

[73]  Stefan Dercon,et al.  Income portfolios in rural Ethiopia and Tanzania: choices and constraints , 1996 .

[74]  J. Sachs,et al.  Geography, demography, and economic growth in Africa. , 1998, Brookings papers on economic activity.

[75]  Julian May,et al.  Sense in Sociability? Social Exclusion and Persistent Poverty in South Africa , 2004 .

[76]  Natural resources and economic growth , 1999 .

[77]  Jan Willem Gunning,et al.  Explaining African Economic Performance , 1999 .

[78]  S. Durlauf.  A theory of persistent income inequality , 1992 .

[79]  Stefan Dercon,et al.  Wealth, risk and activity choice: cattle in Western Tanzania , 1998 .

[80]  Danny Quah,et al.  The New Empirics of Economic Growth , 1998 .

[81]  Tewodaj Mogues,et al.  Social Capital and the Reproduction of Inequality in Socially Polarized Economies , 2004 .

[82]  C. Barrett,et al.  Heterogeneous Constraints, Incentives and Income Diversification Strategies in Rural Africa , 2001 .

[83]  H. Gordon,et al.  The economic theory of a common-property resource: The fishery , 1954, Journal of Political Economy.

[84]  L. Pritchett,et al.  Quantifying vulnerability to poverty : a proposed measure, with application to Indonesia , 2000 .

[85]  David Hulme,et al.  Chronic Poverty and Remote Rural Areas , 2002 .

[86]  R. Barro,et al.  Inflation and Economic Growth , 1995 .

[87]  S. W. Omamo.  Farm‐to‐market transaction costs and specialisation in small‐scale agriculture: Explorations with a non‐separable household model , 1998 .

[88]  Christopher B. Barrett,et al.  Welfare dynamics in rural Kenya and Madagascar , 2006 .

[89]  Allyn A. Young,et al.  INCREASING RETURNS AND ECONOMIC PROGRESS , 1928 .

[90]  Peter A. Streufert,et al.  Dynamic equilibria with unemployment due to undernourishment , 1993 .

[91]  J. Sachs,et al.  Geography and Economic Growth , 1998 .

[92]  B. Swallow.  Potential for Poverty Reduction Strategies to Address Community Priorities: Case Study of Kenya , 2005 .

[93]  Asep Suryahadi,et al.  Assessing household vulnerability to poverty from cross-sectional data: a methodology and estimates from Indonesia ∗ , 2002 .

[94]  Susanne Davies,et al.  Adaptable Livelihoods: Coping With Food Insecurity in the Malian Sahel , 1998 .

[95]  M. Fafchamps,et al.  Crime, Isolation, and Law Enforcement , 2003 .

[96]  P. Dasgupta.  Nutritional status, the capacity for work, and poverty traps , 1997 .

[97]  A. Hirschman,et al.  The strategy of economic development , 1959 .

[98]  J. Stiglitz,et al.  The Economics of Rural Organization , 1995 .

[99]  Jean-Philippe Platteau,et al.  Halting degradation of natural resources: is there a role for rural communities? , 2000 .

[100]  M. Torero,et al.  The assets of the poor in Peru , 1998 .

[101]  Luc Christiaensen,et al.  On Measuring Household Food Vulnerability: Case Evidence from Northern Mali , 2000 .

[102]  M. Ravallion.  Externalities in Rural Development , 2003 .

[103]  Robert J. Barro,et al.  Economic Growth in a Cross Section of Countries , 1991 .

[104]  Martin Ravallion,et al.  Why has economic growth been more pro-poor in some states of India than others? , 2002 .

[105]  R. Solow.  A Contribution to the Theory of Economic Growth , 1956 .

[106]  P. Krugman.  Increasing Returns and Economic Geography , 1991 .

[107]  P. Romer.  Increasing Returns and Long-Run Growth , 1986, Journal of Political Economy.

[108]  A. Gordon,et al.  Livelihood diversification in Uganda: patterns and determinants of change across two rural districts , 2001 .

[109]  C. Barrett,et al.  The System of Rice Intensification in Practice: Explaining Low Farmer Adoption and High Disadoption in Madagascar , 2002 .

[110]  Stefan Dercon,et al.  Vulnerability, seasonality and poverty in Ethiopia , 2000 .

[111]  Andrei Shleifer,et al.  Industrialization and the Big Push , 1988, Journal of Political Economy.

[112]  D. Bryceson,et al.  Farewell to Farms , 1997 .