Abstract This paper constructs an intertemporal substitution educational model based on endogenous growth theory and examines the rural education, farmer income and rural economic growth problems in China. It shows that the households originally with the same economic endowment but different education endowment take different growth routes, the income difference between low- and high-income families can be enlarged as they take different educational growth routes, and the low-income family has t ...he chance to get into the “poverty trap”. In the mean time, urban and rural, developed and underdeveloped rural areas, as they take the different education growth routes the difference of economic growth tend to be expanded for the flow of high-quality labor and different industrialization, and they also have the risk of “poverty trap”. The key to solve this problem is the active public policies that promote the equal education, rational income and equilibrium development.
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