Reconciling the conflicting narratives on poverty in China

The prevailing narrative of a huge reduction in income poverty in China since reforms began in 1978 does not accord with all the evidence. The paper tries to reconcile the conflicting findings. The rise in poverty counts indicated by the strongly-relative measures in the literature is not credible given the properties of these measures. More surprising, and revealing, is the story told by the official lines, which were revised twice since the original 1985 line. The paper shows that the official lines are neither absolute nor strongly relative. Rather, they are weakly relative, with a positive elasticity to the mean that is less than unity. The paper provides a new annual series of weakly-relative poverty measures consistent with the official lines. Poverty has certainly not vanished in China, but substantial progress is indicated.