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Pro-rural policies, income and inequality : Evaluating a cash-for-work program in rural China

Author

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  • Yu Chen

    (UMac - University of Macau)

  • Sylvie Démurger

    (GATE Lyon Saint-Étienne - Groupe d'Analyse et de Théorie Economique Lyon - Saint-Etienne - ENS de Lyon - École normale supérieure de Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet - Saint-Étienne - CNRS - Centre National de la Recherche Scientifique)

Abstract

Despite the dramatic reduction of poverty in China over the past thirty-five years, poverty has not been fully eradicated in rural areas, and in the context of growing inequalities, it remains a national concern. This paper examines a local cash-for-work program launched in mountainous areas of Beijing municipality in December 2004, with a view to understanding both the challenges and achievements of pro-poor programs in China. Using original household survey data, we first highlight the fairly good targeting performance of the program towards the local poor. Second, participation equations provide evidence of increasing local income without crowding out local agricultural activities. Finally, a decomposition of household income inequality by source highlights the strongly equalizing effect of the program on peasants' income.

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  • Yu Chen & Sylvie Démurger, 2014. "Pro-rural policies, income and inequality : Evaluating a cash-for-work program in rural China," Working Papers halshs-00993574, HAL.
    • Handle: RePEc:hal:wpaper:halshs-00993574
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00993574
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    Cited by:

    1. Yuekai Cheng & Hongyi Li & Qi Sun & Yu Wang, 2019. "A Model of Household Savings and Alternative Investments in Rural China," Asian Economic Papers, MIT Press, vol. 18(2), pages 145-162, Summer.

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    More about this item

    Keywords

    cash-for-work program; income source diversification; agricultural households; income inequality; China;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General

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