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On opulence driven poverty traps
Abstract:
"We opt in this study to endogenize the growth rate of the population in such a way that it stresses the empirically supported negative relation between fertility and per capita income. Fertility declines as per capita income rises." The authors conclude that "the less developed economy can get stuck in a variant of the 'Malthusian trap', also called the poverty trap. The only way out of the poverty trap is through an injection of capital (a large transfer) from abroad. Our model therefore, supports...[the] view that aid from the developed countries to the less developed countries has to be increased dramatically...to overcome the poverty trap...."