Analysis of Important Factors Influencing Psychological Capital Based on Numerical Simulation Technology

Abstract

Previous economic literature on poverty alleviation effect has systematically studied the role of infrastructure, financial capital, human capital and social capital, neglecting the important factor of positive psychology, which leads to the ambiguous understanding of poverty alleviation mechanism and effect. This paper takes psychological capital as a positive element of poverty alleviation incorporating into the classic choice framework, and explores the effect of psychological capital in poverty alleviation from two as-pects: its efficiency of poverty alleviation and inhibiting returning to poverty by theoretical analysis and numerical simulation. The results show that: firstly, psychological capital has positive feedback with poverty alleviation efforts and production benefits: more of psychological capital, the higher the level of savings and investment, forming a positive virtuous cycle. Secondly, psychological capital is conducive to improving the efficiency of poverty alleviation: the higher the level of psychological capital, the shorter the time of poverty alleviation required by the same material conditions, and the more probability of poverty alleviation under the same risk impact. Thirdly, psychological capital is beneficial to restrain the households that have been lifted out of poverty from returning to poverty when encounter risk shocks: the higher level of psychological capital and lower elasticity of psychological capital accumulation are beneficial to improve the probability of poverty alleviation of poor households. The combination of the two can more effectively inhibit returning to poverty.