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Are there dynamic gains from a poor-area development program?

  • Jalan, Jyotsna
  • Ravallion, Martin

Poor-area development programs- in which the government transfers extra resources to unusually poor areas -have been widely used to fight poverty. There has been some research on such programs, but little is known about their impact on household living standards over time. The authors address the issue for a sizable poor-area development program in rural China. China's program had a significant impact on rural living standards in the targeted areas of the sample. The consumption-growth model suggests that households living in the targeted areas had a higher rate of consumption growth than one would have otherwise expected. Nonetheless the authors found that while the gains in growth were enough to prevent an absolute decline in average living standards, they were not enough to reverse the strong underlying divergent tendencies in the rural economy.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1695.

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Date of creation: 31 Dec 1996
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Handle: RePEc:wbk:wbrwps:1695
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  1. Rozelle Scott, 1994. "Rural Industrialization and Increasing Inequality: Emerging Patterns in China's Reforming Economy," Journal of Comparative Economics, Elsevier, vol. 19(3), pages 362-391, December.
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  5. Chen, Shaohua & Ravallion, Martin, 1996. "Data in transition: Assessing rural living standards in Southern China," China Economic Review, Elsevier, vol. 7(1), pages 23-56.
  6. Lipton, Michael & Ravallion, Martin, 1993. "Poverty and policy," Policy Research Working Paper Series 1130, The World Bank.
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  19. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 277-97, April.
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