The Study on Poverty Reduction Effects of Chinese Urban Minimum Living Standard Guarantee System—Empirical Analysis Based on CHIP 2002 and 2007

Abstract

The Chinese urban minimum living-standard guarantee system, mainly functions to guarantee the poor people to have minimum living-standard life; at same time it can make some people to get rid of poverty by some poverty lines. But how much of the rates can be reduced? What differences among provinces, and what impact on all kind of families? The paper tries to answer these questions by using Chinese Household Income Project (CHIP) 2002 and 2007, taking international poverty line, minimum living standard line, Martin’s poverty line and relative poverty line respectively to measure the poverty reduction impact of urban minimum living standard guarantee. On the whole, the urban minimum living standard guarantee is effective to alleviate absolute poverty and even part of relative poverty. For example, taking international poverty line as standard, in 2002 the urban minimum living guarantee respectively decreased absolute poverty rate, poverty gap and squared poverty gap of national urban area by 4.58%, 11.41% and 16.32%, while in 2007 decreased respectively by 47.24%, 70.87% and 83.04%. Taking relative poverty line as standard, in 2002 respectively poverty rate, poverty gap and squared poverty gap of national urban area decreased by 1.92%, 4.65% and 8.37%, while in 2007 the 3 indices reached by 3.28%, 11.63% and 22.57% respectively, but which are lower than by international poverty line. On the whole, according to different poverty lines and indices, the urban citizen in different provinces and families gained different poverty reduction effects brought by the urban minimum living standard guarantee.