Poverty Dynamics of Households in Rural China
AbstractThe objective of our study is to identify patterns and causes of households' transitions in and out of poverty using the long household panel data on rural China in the period 1989-2009. We propose a discrete-time multi-spell duration model that not only corrects for correlated unobserved heterogeneity across transitions and various destinations within the transition, but also addresses the endogeneity due to dynamic selection associated with household's livelihood strategies. Duration dependence is generally found to be negative for both poverty exit and entry. The household choosing either farming or out-migration as a main livelihood strategy was more likely to escape from the persistent poverty than those taking local non-agricultural employment. Overall, the present study emphasises the central role of agriculture in helping the chronically poor escape from poverty.
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Bibliographic InfoPaper provided by Research Institute for Economics & Business Administration, Kobe University in its series Discussion Paper Series with number DP2013-16.
Length: 34 pages
Date of creation: Apr 2013
Date of revision: Jun 2013
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Poverty Transition; Discrete-time duration model; Correlated unobserved heterogeneity; Dynamic selection; Rural China;
Find related papers by JEL classification:
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
- I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
This paper has been announced in the following NEP Reports:
- NEP-AGR-2013-05-11 (Agricultural Economics)
- NEP-ALL-2013-05-11 (All new papers)
- NEP-CNA-2013-05-11 (China)
- NEP-DEV-2013-05-11 (Development)
- NEP-TRA-2013-05-11 (Transition Economics)
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