Poverty reduction and growth : virtuous and vicious circles

That raising income levels alleviates poverty, and that growth can be more or less effective in doing so, is well known and has received renewed attention in the search for pro-poor growth. What is less well explored is the reverse channel - that poverty may, in fact, be part of the reason for a country`s poor growth performance. This report is about the existence of these vicious circles in Latin America and about the alternatives to convert them into virtuous circles in which poverty reduction and high growth reinforce each other.