The Pattern of Growth and Poverty Reduction in China

China has seen a huge reduction in the incidence of extreme poverty since the economic reforms that started in the late 1970s. Yet, the growth process has been highly uneven across sectors and regions. The paper tests whether the pattern of China´s growth mattered to poverty reduction using a new provincial panel data set constructed for this purpose. The econometric tests support the view that the primary sector (mainly agriculture) has been the main driving force in poverty reduction over the period since 1980. It was the sectoral unevenness in the growth process, rather than its geographic unevenness, that handicapped poverty reduction. Yes, China has had great success in reducing poverty through economic growth, but this happened despite the unevenness in its sectoral pattern of growth. The idea of a trade-off between these sectors in terms of overall progress against poverty in China turns out to be a moot point, given how little evidence there is of any poverty impact of non-primary sector growth, controlling for primary-sector growth. While the non-primary sectors were key drivers of aggregate growth, it was the primary sector that did the heavy lifting against poverty.

Bibliographic Details

Main Authors:	Montalvo, Jose G., Ravallion, Martin
Language:	English
Published:	2009-10-01
Subjects:	ABSOLUTE POVERTY, AGGREGATE INCOME, AGGREGATE OUTPUT, AGGREGATE POVERTY, AGRICULTURAL EXPORTS, AGRICULTURAL GROWTH, AGRICULTURAL LAND, AGRICULTURAL OUTPUT, AVERAGE GROWTH, AVERAGE GROWTH RATE, CHANGES IN POVERTY, CITIES, COEFFICIENTS, CONSUMER PRICE INDEX, COUNTERFACTUAL, COVARIANCE MATRIX, DETERMINANT OF POVERTY, DEVELOPING COUNTRIES, DEVELOPMENT ECONOMICS, DEVELOPMENT POLICY, DEVELOPMENT REPORT, DEVELOPMENT RESEARCH, DISTRIBUTION OF INCOME, ECONOMIC ACTIVITY, ECONOMIC GROWTH, ECONOMIC REFORMS, ECONOMICS, ECONOMICS LETTERS, ERROR TERM, ESTIMATES OF POVERTY, ESTIMATION METHOD, EXCHANGE RATE, EXPLANATORY VARIABLES, EXTREME POVERTY, FIXED EFFECTS, FIXED EFFECTS ESTIMATION, FIXED EFFECTS ESTIMATOR, GROWTH ELASTICITY, GROWTH PERFORMANCE, GROWTH PRO-POOR, GROWTH PROCESS, GROWTH RATE, GROWTH RATES, HIGH INEQUALITY, IMPACT ON POVERTY, INCOME, INDUSTRIAL SECTOR, INEQUALITY, INEQUALITY WILL, INFLATION RATE, LAND INEQUALITY, LAND RIGHTS, LANDHOLDINGS, LEVEL OF POVERTY, LOW INEQUALITY, MEAN INCOME, MUNICIPALITIES, MUNICIPALITY, NATIONAL POVERTY, NATIONAL POVERTY LINE, 0 HYPOTHESIS, OUTPUT GROWTH, POLICY CHOICES, POLICY DEBATE, POLICY REFORM, POLICY REFORMS, POLICY RESEARCH, POOR, POOR PEOPLE, POPULATION SHARE, POST-REFORM, POVERTY ALLEVIATION, POVERTY IMPACT, POVERTY LINES, POVERTY MEASURES, POVERTY RATE, POVERTY REDUCING, POVERTY REDUCTION, PRO-POOR, PROVINCE, PROVINCIAL DATA, PROVINCIAL LEVEL, PUBLIC INVESTMENT, REDISTRIBUTION, REDUCING INEQUALITY, REDUCING POVERTY, REDUCTION IN POVERTY, REDUCTION OF POVERTY, RURAL, RURAL AREA, RURAL AREAS, RURAL DEVELOPMENT, RURAL ECONOMIC GROWTH, RURAL ECONOMY, RURAL INFRASTRUCTURE, RURAL POPULATION, RURAL POVERTY, RURAL POVERTY REDUCTION, RURAL PROVINCES, SECTORAL COMPOSITION, SIGNIFICANT EFFECT, SIGNIFICANT REDUCTION, SPATIAL DIMENSIONS, SPATIAL INEQUALITY, STANDARD DEVIATION, SUB-NATIONAL, SUBNATIONAL, UNEQUAL DISTRIBUTION, URBAN AREAS, URBAN POVERTY,
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091006163931 https://hdl.handle.net/10986/4260
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