Wealth and asset inequality can prevent the poor from fully engaging in productive activities, by restricting the types of contracts and exchanges open to them, thereby perpetuating the cycle of poverty. Theoretical work that shows that non-market transfers of assets from the wealthy to the less wealthy might have positive efficiency and poverty reducing effects because of these incentive effects. But what evidence is this? Recent land transfers in South Africa allows us to study whether such transfers can make a difference.

This presentation is based on AMA Innovation Lab projects for the Poverty Traps Conference. This conference is a gathering point for USAID and other development assistant agencies to connect the poor to economic growth.

This presentation was presented on February 26, 2009 at Washington, DC.