This paper demonstrates that well-established biases in decision making under uncertainty can generate poverty traps. A … erroneously undervalue profitable investments, and ii) poverty increases the magnitude of these investment errors. The model … predicts that poverty is perpetuated by inducing poor individuals to underinvest in profitable opportunities to a greater …

household consumed permanently at the poverty line. The results indicate that vulnerability is very sensitive to the time …

new dataset of consistent inequality series,allowing us to explore problems of measurement error. In addition, the new … estimate the entire income distribution; computing alternativeinequality indexes and poverty estimates. Finally, we have used … our broad1y comparabledataset to examine international patterns of inequality and poverty. …