Poverty Alleviation in the People's Republic of China: The Implications for Sino–African Cooperation in Poverty Reduction

Abstract: In the last thirty years, remarkable achievements have been made in China's poverty reduction course. The dramatic fall in China's poor can be attributed mainly to a high rate of economic growth, government poverty reduction policies and targeted programmes and pro‐poor macroeconomic and industrial policies. This paper focuses on China's poverty reduction policies and programmes and their impact on the poor regions and poor households. Lessons are drawn for poverty reduction and economic development in African countries. The paper also explores the potential for collaboration in poverty reduction between China and African countries and recommendations are made for the governments and donor agencies.     

Rural Labor Migration and Poverty Reduction in China

Using various sources of data, this paper examines the contributions of rural labor migration to economic growth and poverty reduction in China. The results show that there is still a significant number of people living in poverty in rural areas, while the effectiveness of migration on poverty reduction has declined, implying an urgent need for new approaches to poverty reduction. China's experiences could also be valuable for the formulation of development strategies in other developing countries.     

Growth,Poverty, and Inequality under Jokowi

SUMMARY

The political authority of President Joko Widodo (Jokowi) was bolstered in the third quarter of 2015 by a cabinet reshuffle, his coalition's gaining a parliamentary majority, and several foreign-policy developments. Indonesia's request to rejoin OPEC, for example, after having left in 2008, seemed more about international relations than oil prices, while official visits to the Middle East and the United States allowed Jokowi to project his presidency on the international stage. He still faces resistance from within his own party, however.

Jokowi's politically bold reshuffle of economic ministers in August soon yielded a range of policy announcements. In September and October, his government introduced its first substantial set of reforms—a number of economic policy packages intended, among other things, to attract investment and stimulate domestic demand. If even half of these policies are put in place, the impact on Indonesia's economy should be tangible.

Few countries have escaped the effects of falling global commodity prices and China's growth slowdown. At 4.7%, year on year, in the third quarter Indonesia's rate of economic growth again fell short of the government's target. Slowing growth and a negative outlook have lowered market expectations and weakened the rupiah, which is also burdened by the large outstanding external debt held by corporate borrowers. Indonesia's real effective exchange rate has recently begun to depreciate, however, which may stimulate exports. Growth prospects will also improve if the substantial increase in capital and infrastructure spending allocated in the state budget is realised.

Against this backdrop, we focus on what has happened to poverty and inequality in Indonesia since Jokowi took office. The distributional impacts of the current macroeconomic climate are likely to be hardest felt by the poor. Indonesia is well known for its record on poverty reduction, but between September 2014 and March 2015 the share of the population in poverty increased, even though economic growth was close to 5.0%. Slowing growth, rising food prices, the falling real wages of farmers, and the delayed disbursement of fuel-price compensation all had an effect. Such impacts may be mitigated in the medium term by Jokowi's budget reallocations to infrastructure, if realised, and his expansion of social spending.     

Trade Liberalization,Economic Restructuring and Urban Poverty: The Case of China*

Increased trade openness and rapid market-oriented transformation have largely altered the patterns of wealth accumulation and wealth distribution in post-reform China. In the present paper, with the help of Chinese provincial level data over the period of 1986 to 2000, simultaneous equations estimation and generalized method of moment techniques are applied to investigate the relationship between trade and poverty in urban China. Empirical results suggest that China's trade liberalization helps to reduce urban poverty both directly and indirectly through its favorable impacts on economic growth.     

Microfinance with Chinese Characteristics

Analyzing household survey data from three microfinance program sites, we provide an early systematic assessment of Chinese microfinance programs, which have grown rapidly since 1994, are based on the Grameen model, and include an unprecedented large-scale government initiative. We examine the empirical propositions that underpin successful microfinance programs—reaching the poor (targeting), financial and operational performance (sustainability), and program benefits (impact). We find that nongovernmental programs perform well in all three areas, but that governmental programs perform poorly. Given the remote location and focus on agricultural projects in China's poor areas, we advocate greater flexibility in loan contract terms, especially repayment schedules.     

The Poverty of Politics: How Income Redistribution Hurts the Poor

In spite of the significant research literature identifying a tradeoff between income redistribution and economic growth, massive public programs have been implemented to help the poor by transferring income to them. Since Lyndon Johnson's war on poverty began in 1964, over 3.5 trillion dollars have been transferred. However, the possibility that everyone, including the poor, may in fact be made worse off by the transfer has largely been ignored. With a simple algebraic model, the authors demonstrate that, over time, both high and low-income groups are harmed by redistribution. In addition, social mobility, as well as political concerns with relative poverty and international income redistribution increases the damage to all income groups produced by redistribution.     

Estimating the Impact of Covid-19 on Poverty in Indonesia

Covid-19 has infected and will continue to infect millions of people all over the world. The economic impact is predicted to be large and millions of people will be pushed into poverty. In this paper, we estimate the impact of Covid-19 on poverty in Indonesia. The economic impact is expected to be severe, reducing the economic growth rate projected for 2020 from about 5% to between 4.2% and –3.5%. We find that under the best-case scenario, the poverty rate will increase from 9.2% in September 2019 to 9.7% by the end of 2020, pushing 1.3 million more people into poverty. Under the worst-case scenario, the poverty rate will increase to 16.6%, close to the level seen in 2004 when the poverty rate was 16.7%. This means that 19.7 million more people will become poor, substantially reversing Indonesia’s progress in reducing poverty. The implication is that Indonesia will need to expand its social protection programs to assist the new poor as well as the existing poor.     

社会保险缓解了农村老人的多维贫困吗？——兼论“贫困恶性循环”效应

老年人贫困是中国人口老龄化背景下亟需解决的问题,社会保险则在国家反贫与脱贫方面发挥着不可或缺的作用。采用具有代表性的中国老年健康影响因素（CLHLS2011）大样本微观跟踪调查数据,构建Logit计量回归模型,将农村老人贫困分为经济贫困、健康贫困与精神贫困三个维度,从实证的角度,探讨了社会保险与农村老人贫困的关系。研究发现,养老保险与医疗保险在不同程度上缓解了农村老人多个维度的贫困。文章进一步指出农村老人贫困存在“恶性循环”,经济贫困、健康贫困与精神贫困三个维度之间存在显著的相互正向影响,但社会保险对农村老人陷入“贫困恶性循环”起到了的调节效应,即社会保险弱化了不同贫困之间相互的正向作用。这些经验发现可以为政府改善农村老龄人群的贫困状况提供可靠的政策依据。     

Poverty and Inequality in The Soeharto Era: An Assessment

This paper surveys the evidence on trends in poverty and inequality during the years of Soeharto's presidency. That Indonesia saw a decline in the incidence of poverty, and improvements in other welfare indicators such as infant mortality rates and literacy rates over these years, seems indisputable. Comparative studies show that by the latter part of the 1980s, the headcount measure of poverty in Indonesia was below that in the Philippines although above that in Malaysia and Thailand. But relative poverty has declined more slowly, and indeed increased in some urban areas between 1987 and 1996. The paper also examines evidence on the determinants of rural poverty in Indonesia in 1993, and suggests that rural development programs targeted to the specific needs of poor people in poor areas will be essential if rural poverty is to be further reduced in future years.     

Taxation and the Environment–Health–Poverty Trap: A Policy Experiment Perspective

Under pressures related to economic growth and environmental protection, China is facing an increasingly severe “environment–health–poverty” trap risk. Fuel taxation is generally considered an effective policy to counter such a risk. Since 2009 China has raised the fuel tax rate many times to enhance tax reform. However, the effects of this policy remain unknown. Therefore, it is vitally important to estimate the impacts of China's current fuel taxation policy on environment, public health and the national economy. As the first attempt in existing literature on China, this paper builds a general equilibrium framework with the feedback effect of public health on economy. We find that that the fuel tax policy benefits the adjustment of the economic structure and improves human health; however, it is detrimental to economic growth, public welfare and price stability. In this sense, it plays a limited role in reducing the trap risk and might not be sustainable in the long term.     

基于经济增长的新疆减贫效果趋势分析

经济增长和减贫一直是发展中国家和地区制定发展战略所考虑的重点。改革开放初期,新疆通过经济增长极大地降低了农村贫困,经济增长的减贫效果显著;20世纪80年代中后期至2010年,由于经济增长的质量下降和收入不平等程度增加,减贫趋势变缓;2011年以后,随着援疆工作和民生工程的不断推进,高速的经济增长和对贫困人口有利的收入分配对减贫起到了良好的效果,经济增长出现了益贫性特征。纵观改革开放至今,新疆减贫成就的主要原因是经济持续的高速增长、人力资本的明显改善和政府采取的反贫困行动;而其减贫趋势放缓的原因是农村经济增长质量的下降和农村收入分配的不断恶化。为此,本文认为新时期扶贫工作中,新疆应实施益贫式增长战略。从生产领域着手,在增加就业的同时通过增加穷人的资产基础以提高穷人的自我发展能力,而政府在打造民生工程时应注重市场机制,以保持减贫的可持续性。     

China＇s Economy in 2005： At a New Turning Point and Need to Fix Its Development Problems

I. High Growth, Higher Stakes China’s economy in 2005 experienced another year of surging growth, with its total GDP(based on recent revision) expanding at 9.9 percent to reach 18.23 tn yuan (US$2.26 tn).1 Growth in 2005 was slightly lower than the 10.1 percent in 2004; but it was nonetheless very high. Sustained high growth is accompanied by potential high risks, and it inevitably raises the issue of future sustainability of high growth. Although the Chinese economic policy-makers in 200…     

宁夏回族自治区乡村旅游扶贫研究

乡村旅游扶贫是我国扶贫工作的重点。宁夏民族地区以其独特的自然优势将乡村旅游扶贫工作发挥的淋漓尽致,不仅帮助了贫困户实现脱贫,还带动了产业的转型。针对宁夏回族自治区为分析其贫困现状和导致贫困的原因进行了研究,以及展开对乡村旅游扶贫的优劣势和面临的阻碍。根据分析结果,探讨了宁夏乡村旅游扶贫的问题与对策。     

How dependent is the Chinese economy on exports and in what sense has its growth been export-led?

This paper studies the interaction between foreign trade and domestic demand and supply in China's economic transformation. It compares China's export dependency with other economies using input–output analysis. The paper also conducts econometric analysis of provincial level data to examine causality between the growth of foreign trade and components of domestic demand, and causality between the growth of foreign trade and total factor productivity. The main message is that China's export dependency is significantly lower than implied by the headline exports-to-GDP ratio. Moreover, the contribution of export to economic growth in China came mainly from its impact on total factor productivity growth from a supply perspective rather than its multiplier effect from a demand perspective. This relationship was found to be stronger in the more developed coastal areas than in the less developed inland areas.     

Sectoral Growth and Poverty Alleviation: A Multiplier Decomposition Technique Applied to South Africa

How does an increase in a sector's output affect poverty alleviation? In this paper a multiplier decomposition for a socioeconomic system represented by a Social Accounting Matrix (SAM) is used to study this linkage. The decomposition applied to South Africa reveals that growth in agriculture, services and some manufacturing sectors can alleviate poverty for the black African population. For sectoral growth to be effective, however, the need for appropriate skill acquisition for the poor must be addressed directly. Only long-term policies geared towards improving both economic growth and the human capital stock of the poor can lead to significant poverty alleviation.     

On Public Organizations in Ghana: What Differentiates Good Performers from Poor Performers?*

Abstract: Public sector reform programs implemented across Africa, including the World Bank's ‘first’ and ‘second’ generation reforms, are based on the assumption that all public organizations are inefficient. This problematic assumption has had significant implications for policy in Africa. By failing to recognize that not all public organizations perform poorly, we ignore any potential lessons that could have been learnt from the experiences of organizations that have managed to perform effectively under the same social, political, economic and institutional environment. This paper uses Ghana as a case study to examine whether there are significant differences in the characteristics of poor and good performing public organizations. It is found that good and poor performing organizations in Ghana were significantly different in two respects: remuneration and hiring criteria.     

Targeted poverty investments and economic growth in China

In the mid-1980s, the Chinese government launched its ambitious poor area development policy, which was centered around a series of grant, credit, and Food-for-Work programs. Ironically, for the remainder of the 1980s rural poverty remained at about 90 to 100 million, or approximately 10% of the rural population. The lack of progress cannot necessarily be blamed on ineffective poor area policies, since much of the agricultural economy was mired in a deep recession between the mid-1980s and the early 1990s. By the mid-1990s substantial additional poverty reduction had been achieved. Even in the late-1980s, farmers in many poor counties did better than the national average in terms of income growth. After accounting for the effects of macroeconomic elements, what factors can help explain the differences in performance among poor regions and between poor areas and rich ones? Can part of these differences be accounted for by poor area policies, in general, or by the way local and regional officials allocate their poor area investment funds, in particular?The overall objective of this paper is to analyze the effectiveness of Chinese poor area policy. Specifically, the paper seeks to meet three objectives. First, we want to understand the evolution of poor area policy since the mid-1980s, trying to deduce the true goals of central and regional poor area officials, as well as how these policies have been implemented in the provinces. Next, we want to understand the magnitude and scope of investment into poor areas, and examine if changes in these policies have affected the uses of the investment funds. Finally, we want to determine the effectiveness of the investment of poor area funds, analyzing which types of investments have generated growth, and which ones have not.     

Rural Poverty Dynamics and Impact of Intervention Programs upon Chronic and Transitory Poverty in Northern Ethiopia*

Abstract: Using a three‐year panel data set of rural households in the Tigray region of northern Ethiopia, we examine the dynamics of poverty and the impact of two intervention measures—the food for work (FFW) and the food security package (FSP) programs—upon poverty by disaggregating total poverty into its transient and chronic components. Poverty in the region is predominantly chronic. Results of matching estimators indicate that the FSP program has a significant negative effect on total and chronic poverty, but not on transient poverty. Households involved in the program have on average lower levels of total and chronic poverty than households not involved in the program. The FFW on the other hand does not significantly influence any of the three forms of poverty. Tertile regressions, however, reveal that the FFW benefits households in the richest and the middle tertiles.     

Neighborhood Effects and Regional Poverty Traps in Rural China

The present paper investigates how neighborhood effects are connected to chronic poverty. We examine a large sample of groups of households and find that neighborhood effects are significant in a majority of groups, especially in the poorest groups. People living in poor communities tend to suffer from poverty over time. It is of theoretical and empirical importance to explore how neighborhood effects are interrelated with chronic poverty and the channels through which this occurs. Unlike other econometric analyses, we establish a multilevel econometric model to show that： （i） it is difficult for an individual living in a neighborhood with a high proportion of agricultural labor, low education levels, and poor transport and telecommunication infrastructure to escape from poverty traps; （ii） neighborhood effects dominate in poor communities; and （iii） although poverty is affected by group-level factors, individual factors still play a dominant role in regards to escaping poverty when income surpasses a threshold level Therefore, policy priority should be given to providing social protection and public services, especially in poor rural areas.     

Public Expenditure,Growth and Poverty Reduction in Rural Uganda

Abstract: Using district‐level data for 1992, 1995, and 1999, the study estimated effects of different types of government expenditure on agricultural growth and rural poverty in Uganda. The results reveal that government spending on agricultural research and extension improved agricultural production substantially. This type of expenditure had the largest measured returns to growth in agricultural production. Agricultural research and extension spending also had the largest assessed impact on poverty reduction. Government spending on rural roads also had a substantial marginal impact on rural poverty reduction. The impact of low‐grade roads such as feeder roads is larger than that of high‐grade roads such as murram and tarmac roads. Education's effects rank after agricultural research and extension, and roads. Government spending in health did not show a large impact on growth in agricultural productivity or a reduction in rural poverty. Additional investments in the northern region (a poor region) contribute the most to reducing poverty. However, it is the western region (a relatively well‐developed region) where most types of investment have highest returns in terms of increased agricultural productivity.