Fig. 3. Figure 3(a) reproduces Barrett and Swallow’s (2006) figure on well-being dynamics under the poverty trap hypothesis for comparison with the new extended figure provided in 3(b). Figure 3(b) generalizes the approach to multiple forms of capital, which interact to create two self-reinforcing stable states at different equilibrium levels of capital. Vitally, 3(b) illustrates that improvements to either human or physical capital alone may not provide the most effective transition from the impoverished state to the more desirable state.

Fig. 3