1711. Assets, Shocks, and Poverty Traps in Rural Mozambique
- Author:
- Lena Giesbert and Kati Schindler
- Publication Date:
- 11-2010
- Content Type:
- Working Paper
- Institution:
- German Institute of Global and Area Studies
- 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 endowments 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 rural areas and limited new economic opportunities outside of the agricultural sector.
- Topic:
- Economics, Markets, and Poverty
- Political Geography:
- Africa