Did China's Tax-for-Fee Reform Improve Farmers' Welfare in Rural Areas?
AbstractChina enacted a rural tax reform â€“ the "Tax-for-Fee Reform" (TFR) â€“ in the late 1990s. A crucial but unanswered question is whether this reform improved farmers' welfare in rural areas. This paper uses village-level survey data from the Chinese Household Income Project in order to examine the effect of the TFR on farmers' direct and indirect welfare. We find no evidence that the direct welfare effects improved farmer's net income. In contrast, the reform appears to have reduced the villages' financing capacity, and hence to have lowered their overall expenditures. These indirect effects have had significant negative impacts on farmers' welfare.
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Bibliographic InfoPaper provided by Tulane University, Department of Economics in its series Working Papers with number 1305.
Length: 37 pages
Date of creation: Feb 2013
Date of revision:
tax-for-fee reform; inequality; rural China;
Other versions of this item:
- James Alm & Yongzheng Liu, 2013. "Did China's Tax‐for‐Fee Reform Improve Farmers' Welfare in Rural Areas?," The Journal of Development Studies, Taylor and Francis Journals, vol. 49(4), pages 516-532, April.
- H7 - Public Economics - - State and Local Government; Intergovernmental Relations
- I2 - Health, Education, and Welfare - - Education
- I3 - Health, Education, and Welfare - - Welfare and Poverty
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- O5 - Economic Development, Technological Change, and Growth - - Economywide Country Studies
- P3 - Economic Systems - - Socialist Institutions and Their Transitions
This paper has been announced in the following NEP Reports:
- NEP-ACC-2013-03-30 (Accounting & Auditing)
- NEP-AGR-2013-03-30 (Agricultural Economics)
- NEP-ALL-2013-03-30 (All new papers)
- NEP-DEV-2013-03-30 (Development)
- NEP-PBE-2013-03-30 (Public Economics)
- NEP-TRA-2013-03-30 (Transition Economics)
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