The Vicious Circle of Poverty

Prof. Nurkse states , “A country is poor because it is poor.” It implies that poverty itself creates such condition that an economy remains in the grip of poverty. Vicious circle of poverty is such a circular activity whose beginning is poverty and whose end is also poverty. In these economies poverty is the cause of poverty and poverty is the result of poverty. Accordingly poverty breeds itself. This is illustrated in diagram. This circular relationship is known as the “vicious circles of poverty” that tend to perpetuate the low level of development in low developing countries.