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Reconciling the Conflicting Narratives on Poverty in China

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Abstract

The widely held view that China has greatly reduced income poverty over the last 40 years does not accord with all the evidence. The paper tries to reconcile the conflicting findings. The fact that strongly-relative measures show rising poverty is easily understood, since such measures depend solely on relative distribution, and inequality in China has been rising until recently. 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. Along with rising inequality, this feature slowed the pace of measured poverty reduction when compared to absolute measures. Nonetheless, substantial progress against poverty is indicated, as we confirm using our independent, and higher, weakly-relative lines calibrated to cross-country data. Classification- I32, O15

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  • Martin Ravallion & Shaohua Chen, 2021. "Reconciling the Conflicting Narratives on Poverty in China," Working Papers gueconwpa~21-21-09, Georgetown University, Department of Economics.
  • Handle: RePEc:geo:guwopa:gueconwpa~21-21-09
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    Cited by:

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    3. Hong Sun & Xiaohong Li & Wenjing Li & Jun Feng, 2022. "Differences and Influencing Factors of Relative Poverty of Urban and Rural Residents in China Based on the Survey of 31 Provinces and Cities," IJERPH, MDPI, vol. 19(15), pages 1-15, July.
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    More about this item

    Keywords

    China; poverty lines; relative income;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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