We analyze public investment in social infrastructure using a two-period model in which a government must intermediate all infrastructure investment. Voters choose a government from two alternative types, high quality and low quality. A high quality government obtains higher returns on...

This survey reviews models of self-reinforcing mechanisms that cause poverty to persist. Some of them examine market failure in environments where the neoclassical assumptions on markets and technology break down. Other mechanisms include institutional failure which can, by itself, perpetuate...