The Experience of Poverty Reduction in Rural China

Abstract

Since 1978, China has greatly reduced the rural poverty rate. This article provides an overview of the experience of China’s poverty reduction. Using panel data from 1996 to 2013 to calculate farmers’ income dynamics, we found that the pace of poverty reduction was relatively slow from 1996 to 2002 and that the rate of reversion to poverty was high. Since 2003, the pace of poverty reduction has accelerated, whereas the rate of reversion has decreased. Using econometric ordinary least squares and probit models, we explore the factors that drive poverty reduction. We found correlational evidence that the main reasons for poverty reduction in China since 1996 have been the increase in income from household farms and migrant work. In addition, rural public insurance prevented farmers from falling into poverty.