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Byline: Martin Ravallion, Shaohua Chen
China; Poverty; Inequality; Economic growth; Policies
While the incidence of extreme poverty fell dramatically in China
over 1980-2001, progress was uneven over time and across provinces.
Rural areas accounted for the bulk of the gains to the poor, though
migration to urban areas helped. Rural economic growth was far more
important to national poverty reduction than urban economic growth;
agriculture played a far more important role than the secondary or
tertiary sources of GDP. Taxation of farmers and inflation hurt the
poor; local government spending helped them in absolute terms; external
trade had little short-term impact. Provinces starting with relatively
high inequality saw slower progress against poverty, due both to lower
growth and a lower growth elasticity of poverty reduction.
Development Research Group, World Bank, 1818 H Street NW,
Washington DC, 20433, USA
Received 5 August 2004; Revised 28 June 2005; Accepted 30 July 2005
(footnote) [star] These are the views of the authors and should not
be attributed to the World Bank or any affiliated organization.