First, widespread poverty creates conditions in which the poor have no access to credit, are unable to finance their children’s education, and, in the absence of physical or monetary investment opportunities, have many children as a
source of old-age financial security. Together these factors cause per capita growth to be less than what it would be if there were greater equality.
Second, a wealth of empirical data bears witness to the fact that unlike the historical experience of the now developed countries, the rich in many contemporary poor countries are generally not noted for their frugality or for their desire to save and invest substantial proportions of their incomes in the local economy.