@article{Geyer:347524,
      recid = {347524},
      author = {Geyer, Herman },
      title = {Poverty Traps in South African Agriculture},
      journal = {Agrekon},
      address = {2016-12-21},
      number = {2540-2024-4461},
      month = {Dec},
      year = {2016},
      abstract = {The article analyses the operation of poverty traps in  South African agriculture through an analysis of the 2007  agricultural census. The poverty trap is a self-reinforcing  mechanism in the market in which small variances in initial  conditions can result in bimodality into differential  economic steady-states resulting in multiple equilibria.  Reasons for this include the savings trap, creating locally  increasing rates return due to indivisible lumpy capital  inputs; the technological trap in which the diminishing  marginal rates of technological substitution diminishes  productivity growth; the demographic trap in which  population growth reduces the capital-labour ratio,  increasing consumption and pure time costs; the stochastic  returns trap in which producers without access to risk  smoothing mechanisms assume greater risks; and the  liquidity trap in which present and future capital values  exceed current agricultural revenues. The study  demonstrates that the failure of land reform and  small-scale agriculture assistance programmes is thus a  product of market failures, not policies. The analysis  indicates that locally increased returns, symptomatic of  the savings trap exists with initial average expenditures  of smaller firms exceeding the average incomes. The  technology trap is also evident with average incomes of  small firms is also very low relative to the average  capital asset values. The mean productivity of workers in  terms of revenue per employee supports the argument for  productivity declines in small firms due to the demographic  trap. Initial declines in income per ton outputs of smaller  firms validate the stochastic returns poverty trap.},
      url = {http://ageconsearch.umn.edu/record/347524},
      doi = {https://doi.org/10.22004/ag.econ.347524},
}