Regional Agricultural Endowments and Shifts of Poverty Trap Equilibria: Evidence from Ethiopian Panel Data

Stephen C. Smith () and Sungil Kwak ()

Working Papers from The George Washington University, Institute for International Economic Policy

Abstract: We introduce new approaches to research on poverty traps, focusing on changes in patterns of equilibria over time and across regions, applied to the Ethiopia Rural Household Survey. We revisit the incidence of multiple equilibria using new nonparametric techniques; we also emphasize conditions of single equilibria that remain stagnant below the poverty line. We identify a single equilibrium in our initial interval (1994 - 1999) but and evidence that a second, higher equilibrium is emerging in the subsequent (1999 - 2004) interval. One of three major regions exhibits a deeply impoverished equilibrium that does not improve despite a national environment of pro-poor growth.

Keywords: poverty trap; Ethiopia; multiple equilibria; asset dynamics; regional poverty; sequence of equilibria (search for similar items in EconPapers)
JEL-codes: O1 I3 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-agr and nep-dev
Date: 2011-04
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Persistent link: http://EconPapers.repec.org/RePEc:gwi:wpaper:2011-01

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