IDEAS home Printed from https://ideas.repec.org/a/bla/chinae/v30y2022i5p29-48.html
   My bibliography  Save this article

Effects of Public Transfers on Income Inequality and Poverty in Rural China

Author

Listed:
  • Hisatoshi Hoken
  • Hiroshi Sato

Abstract

This study examines the impacts of public transfers on income inequality and poverty reduction in rural China. It uses nationally representative rural household surveys from the China Household Income Project and classifies public transfers into three types – universal, pro‐poor, and reimbursable transfers – to compare the impacts of each type of public transfer in 2013 and 2018. Estimated results show that the contributions of each type of public transfer to reducing income inequality were generally small in both 2013 and 2018. However, the effects of reimbursable transfers were the largest of the three types. We also found that the poverty‐reducing effects were the largest for reimbursable transfers, and their impacts have considerably improved in the western region. The impacts of pro‐poor transfers were intermediate but have developed notably in the central region. These findings suggest that reimbursable and pro‐poor transfers contributed mainly to reducing rural poverty but the impacts were heterogeneous among regions.

Suggested Citation

  • Hisatoshi Hoken & Hiroshi Sato, 2022. "Effects of Public Transfers on Income Inequality and Poverty in Rural China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 30(5), pages 29-48, September.
    • Handle: RePEc:bla:chinae:v:30:y:2022:i:5:p:29-48
    DOI: 10.1111/cwe.12436
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/cwe.12436
    Download Restriction: no
    File URL: https://libkey.io/10.1111/cwe.12436?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Han, Huawei & Gao, Qin, 2019. "Community-based welfare targeting and political elite capture: Evidence from rural China," World Development, Elsevier, vol. 115(C), pages 145-159.
    2. Golan, Jennifer & Sicular, Terry & Umapathi, Nithin, 2017. "Unconditional Cash Transfers in China: Who Benefits from the Rural Minimum Living Standard Guarantee (Dibao) Program?," World Development, Elsevier, vol. 93(C), pages 316-336.
    3. Li,Shi & Sato,Hiroshi & Sicular,Terry (ed.), 2013. "Rising Inequality in China," Cambridge Books, Cambridge University Press, number 9781107002913.
    4. Nora Lustig, 2015. "The Redistributive Impactive of Government Spending on Education and Health Evidence from Thirteen Developing Countries in the Commitment to Equity Project," Commitment to Equity (CEQ) Working Paper Series 1330, Tulane University, Department of Economics.
    5. James Foster & Joel Greer & Erik Thorbecke, 2010. "The Foster–Greer–Thorbecke (FGT) poverty measures: 25 years later," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(4), pages 491-524, December.
    6. James E. Foster & Joel Greer & Erik Thorbecke, 2010. "The Foster-Greer-Thorbecke (FGT) Poverty Measures: Twenty-Five Years Later," Working Papers 2010-14, The George Washington University, Institute for International Economic Policy.
    7. Kakwani, Nanak & Li, Shi & Wang, Xiaobing & Zhu, Mengbing, 2019. "Evaluating the effectiveness of the rural minimum living standard guarantee (Dibao) program in China," China Economic Review, Elsevier, vol. 53(C), pages 1-14.
    8. Nora Lustig, 2015. "The Redistributive Impactive of Government Spending on Education and Health Evidence from Thirteen Developing Countries in the Commitment to Equity Project," Commitment to Equity (CEQ) Working Paper Series 30, Tulane University, Department of Economics.
    9. Orsetta Causa & Mikkel Hermansen, 2017. "Income redistribution through taxes and transfers across OECD countries," OECD Economics Department Working Papers 1453, OECD Publishing.
    10. Qin Li & Yafeng Wang & Yaohui Zhao, 2018. "The Impact of China's New Rural Pension Program on Elderly Labor, Grandchild Care, and Old-Age Support," Feminist Economics, Taylor & Francis Journals, vol. 24(2), pages 265-287, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cheng, Xiaoyu & Wang, Jianying & Chen, Kevin Z., 2022. "Does villager social capital hinder poverty targeting? Evidence from poverty-stricken county of Western China," China Economic Review, Elsevier, vol. 71(C).
    2. Qin Gao & Fuhua Zhai & Yi Wang, 2022. "Welfare Participation Reduced Severe Child Multidimensional Poverty in Rural China: Better Targeting Can Lead to Greater Poverty Reduction," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 15(3), pages 913-932, June.
    3. Clarke, Philip & Erreygers, Guido, 2020. "Defining and measuring health poverty," Social Science & Medicine, Elsevier, vol. 244(C).
    4. Tomáš Želinský & Martina Mysíková & Thesia I. Garner, 2022. "Trends in Subjective Income Poverty Rates in the European Union," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(5), pages 2493-2516, October.
    5. Nora Lustig, 2017. "Fiscal Policy, Income Redistribution and Poverty Reduction in Low and Middle Income Countries," Commitment to Equity (CEQ) Working Paper Series 54, Tulane University, Department of Economics.
    6. Haqiqi, Iman & Yasharel, Sepideh, 2018. "Removing Fossil Fuel Subsidies to Help the Poor," MPRA Paper 95907, University Library of Munich, Germany.
    7. Jiandong Chen & Ping Wang & Jixian Zhou & Malin Song & Xinyue Zhang, 2022. "Influencing factors and efficiency of funds in humanitarian supply chains: the case of Chinese rural minimum living security funds," Annals of Operations Research, Springer, vol. 319(1), pages 413-438, December.
    8. Manzoor Hussain Memon, 2023. "Poverty, Gap and Severity Estimates for Disaster Prone Rural Areas of Pakistan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 166(3), pages 645-663, April.
    9. Ravi Kanbur & Tuuli Paukkeri & Jukka Pirttilä & Matti Tuomala, 2018. "Optimal taxation and public provision for poverty reduction," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 25(1), pages 64-98, February.
    10. Ye, Yuxiang & Koch, Steven F., 2021. "Measuring energy poverty in South Africa based on household required energy consumption," Energy Economics, Elsevier, vol. 103(C).
    11. Zixuan He & Xiangming Fang & Nathan Rose & Xiaodong Zheng & Scott Rozelle, 2021. "Rural minimum living standard guarantee (rural Dibao) program boosts children's education outcomes in rural China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 13(1), pages 54-77, January.
    12. Higgins, Sean & Lustig, Nora, 2016. "Can a poverty-reducing and progressive tax and transfer system hurt the poor?," Journal of Development Economics, Elsevier, vol. 122(C), pages 63-75.
    13. Kakwani, Nanak & Li, Shi & Wang, Xiaobing & Zhu, Mengbing, 2019. "Evaluating the effectiveness of the rural minimum living standard guarantee (Dibao) program in China," China Economic Review, Elsevier, vol. 53(C), pages 1-14.
    14. Nora Lustig, 2016. "Fiscal Policy, Inequality and the Poor in the Developing World," Working Papers 1612, Tulane University, Department of Economics, revised Aug 2017.
    15. Wenguang Zhang & Ting Lei & Yu Gong & Jun Zhang & Yirong Wu, 2022. "Using Explainable Artificial Intelligence to Identify Key Characteristics of Deep Poverty for Each Household," Sustainability, MDPI, vol. 14(16), pages 1-21, August.
    16. Espinoza-Delgado, José & Klasen, Stephan, 2018. "Gender and multidimensional poverty in Nicaragua: An individual based approach," World Development, Elsevier, vol. 110(C), pages 466-491.
    17. Romanus Osabohien & Alexander Nimo Wiredu & Paul Matin Dontsop Nguezet & Djana Babatima Mignouna & Tahirou Abdoulaye & Victor Manyong & Zoumana Bamba & Bola Amoke Awotide, 2021. "Youth Participation in Agriculture and Poverty Reduction in Nigeria," Sustainability, MDPI, vol. 13(14), pages 1-19, July.
    18. Rita Motzigkeit Gonzalez, 2016. "Welfare effects of changed prices The “Tortilla Crisis" revisited," Working Papers 167, Bavarian Graduate Program in Economics (BGPE).
    19. Michael P. Vale, 2022. "Contextualizing Poverty along with the Sustainable Development Goals (SDG’s) 3, 6 and 9 as non-income indicators in Ocampo, Camarines Sur Philippines: Evidences from CBMS 2019," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 6(8), pages 249-259, August.
    20. Nora Lustig, 2016. "El Impacto del Sistema Tributario y el Gasto Social en la Distribucion del Ingreso y la Pobreza en America Latina: Argentina, Bolivia, Brasil, Chile, Colombia, Costa Rica Ecuador, El Salvador, Guatema," Commitment to Equity (CEQ) Working Paper Series 37, Tulane University, Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:chinae:v:30:y:2022:i:5:p:29-48. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/iwepacn.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.