Poverty Trap
Poverty is widespread in Africa; people have been trying to fight it since the 1940s.
Poorer countries have found themselves in a poverty trap for many years, and Africa has often been cited as an example.
Take the case of fuel prices. When the prices of fuel go up, it affects the economies and deepens levels of poverty.
Fuel prices can go up because of wars and conflicts, high global demand, currency fluctuations, changes in taxes and subsidies, or even natural disasters.
When it happens, the rich countries get a hit, but the poor countries get a knockout.
The major raw material for manufacturing fertilizer is fossil fuel, and most poorer countries depend on agriculture to feed themselves and to earn income.
When fertilizer prices go up, farmers in poor countries reduce the size of their farms to cut costs.
Farmers then reduce the number of workers, and those who remain may face wage cuts or lose their jobs.
The consequences quickly spread to the family. The farm workers' kids will not have enough food, which will affect their concentration at school.
The farm workers will be forced to save their energy by not doing much.
Biologically, humans need a minimum of 1,200 kcal/day to survive and not die.
Then we need an extra ~800–1,800 kcal to work productively. When nutrition falls short, both survival and productivity are at risk.
The farm worker's bright daughter is forced to drop out of school and start working because the family needs food now more than education.
The farm worker gets depressed; the only hope he had was his daughter to get them out of poverty.
This is how generation after generation gets into a poverty trap according to Economist Esther Duflo.