Endogenous growth theory explains poverty traps as the result of
A) discrimination
B) wide variations in basic human attitudes, motivation, and risk-taking
C) more rapid depreciation of human capital among some groups than others
D) interdependencies which make investments more valuable in wealthy regions
E) mismanaged government policy

Question

Quizplus · Accepted Answer

Endogenous growth theory argues that economic growth is driven by investments in knowledge and innovation. In this context, poverty traps can arise in regions where there are interdependencies that make investments less valuable, such as lack of access to infrastructure, skilled labor, or technological knowledge. As a result, these regions may have lower rates of innovation, productivity, and income growth, leading to persistent poverty.

Endogenous Growth Theory Explains Poverty Traps as the Result of