Rural Poverty Dynamics: Development Policy Implications
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This paper summarizes a few key findings from a rich and growing body of research on
the nature of rural poverty and, especially, the development policy implications of
relatively recent findings and ongoing work. Perhaps the most fundamental lesson of
recent research on rural poverty is the need to distinguish transitory from chronic
poverty. The existence of widespread chronic poverty also raises the possibility of
poverty traps. I discuss some of the empirical and theoretical challenges of identifying
and explaining poverty traps. In policy terms, the distinction between transitory and
chronic poverty implies a need to distinguish between “cargo net” and “safety net”
interventions and a central role for effective targeting of interventions.