Poverty and Living Standards since 1949

by

Alan Piazza

• LAST REVIEWED: 29 May 2014
• LAST MODIFIED: 29 May 2014
• DOI: 10.1093/obo/9780199920082-0080

Introduction

Trends in poverty and living standards in China were mixed during the period from 1949 to 1978. In the 1950s and 1970s, the more egalitarian distribution and increased production of food, combined with improvements in access to basic education and public health, reduced poverty, and improved living standards. During the Great Leap Forward period (1959–1962), however, the collapse of food production and the failure to take corrective measures led to widespread famine of historic proportions and a sharp decline in living standards. China’s subsequent tremendous success in reducing extreme poverty during the economic reform period (1978–2013) is widely recognized. World Bank estimates indicate that the number of absolute poor (that is, those people consuming less than $1.25 per day in Purchasing Power Parity terms) in China declined by more than 600 million from about 835 million in 1981 to 173 million in 2008. Based on a much more austere poverty line, official government estimates indicate that the number of poor was significantly lower than the World Bank estimates throughout the economic reform period but confirm a similar sharp decline in poverty over these years. Moreover, these consumption- and income- based estimates of the decline in poverty are matched by broad-based improvements in nutritional status, educational attainment, health, and other indicators of well-being since the late 1990s. While there is consensus on the massive reduction in poverty in China during the economic reform period, there is continuing debate on the effectiveness of the government’s poverty reduction program. Other important issues include the deterioration of access to basic education and public health in rural areas resulting from the dissolution of the commune system during 1978–1984 and the widening of income disparity beginning in the mid-1980s. In addition, while very large-scale Labor Migration has made a massive contribution to economic growth and poverty reduction, there are also many well-recognized adverse social consequences to this demographic trend. There is also concern that ethnic minority people, people with disabilities, the elderly, and women are known to represent disproportionately large shares of China’s remaining absolute poor and suffer the greatest deprivation. China has actively collaborated with a host of international partners on its poverty reduction program during the economic reform period. Consistent with China’s strong economic growth, the Chinese government has begun the transition from development aid recipient to aid donor, and is expanding its role in international poverty reduction and development work. This article was compiled with the assistance of Wang Yilin.

General Overviews

Though now somewhat outdated, United Nations Development Programme 1999 provides an excellent overview of trends in poverty, education, health, and women’s status since 1949. World Bank 1992 is one of the earliest comprehensive reviews, while World Bank 2001 focuses more closely on the effectiveness and efficiency of the government’s poverty reduction program. While lauding overall success in poverty reduction and improving living standards, Asian Development Bank 2004 flags the emergence of Urban Poverty since 1995 as a growing concern. Khan and Riskin 2001 provides an alternative assessment of trends in poverty reduction and living standards during the 1980s and 1990s. He, et al. 2001 is a compilation of forty-four influential papers written by some of China’s best researchers, and Yan and Wang 1992 examines the geographic concentration of rural poverty. Information Office of the State Council 2011 provides an up-to-date, comprehensive summary of the totality of China’s poverty reduction work. With the reduction of extreme poverty (that is, the number of those poor not able to meet the most basic food and clothing needs) to very low levels in recent years, China Development Research Foundation 2009 (cited under New Directions) calls for new methods in China’s approach to poverty reduction. Similarly, World Bank 2009 (cited under New Directions) finds that the poor are now more widely dispersed and calls for a variety of new poverty reduction measures to better target poor individuals and households.

• Asian Development Bank. Poverty Profile of the People’s Republic of China. Manila, Philippines: Asian Development Bank, 2004.

  This insightful analysis recognizes China’s success in reducing poverty and improving living standards, lauds the government’s growing emphasis on the participatory approach, and calls for greater attention to emerging urban poverty.

• He Daofeng, Wang Ming, Wang Xiyu, et al., eds. Omnibus of Best Poverty Papers. 2 vols. Poverty Reduction Research Series in China. Beijing: China Economics Publishing House, 2001.

  This two-volume work provides translations of the best forty-four papers selected from more than five thousand Chinese papers on China’s poverty reduction experience during 1978–2000. The editorial board, led by He Daofeng, includes many of China’s most well-known rural researchers. The forty-four papers include assessments of the government’s poverty reduction program and nongovernmental organization (NGO) engagement in poverty reduction work.

• Information Office of the State Council. New Progress in Development-Oriented Poverty Reduction Program for Rural China. Beijing: Information Office of the State Council, 2011.

  This State Council white paper reviews the progress of the totality of China’s poverty reduction work during 2001–2010. The comprehensive summary of support for rural development, poverty reduction, social services, infrastructure, applied agricultural research, voluntary resettlement, and collaboration with civil organizations and international organizations convincingly documents the government’s deep determination and vast efforts to overcome rural poverty in the new century.

• Khan, Azizur, and Carl Riskin. Inequality and Poverty in China in the Age of Globalization. New York: Oxford University Press, 2001.

  This review of inequality, poverty, health, education, and women’s status during the 1980s and 1990s bases much of its analysis on independent household surveys undertaken by the Chinese Academy of Sciences in 1988 and 1995. Concludes that the sharp increase in inequality during this period severely limited overall poverty reduction, and that urban poverty was much greater than the extremely low levels reported by the Chinese government and others.

• United Nations Development Programme. The China Human Development Report. New York: Oxford University Press, 1999.

  The United Nations Development Programme’s first national Human Development Report for China provides a comprehensive overview of education, health, women’s status, and poverty from 1949 to 1999. While lauding China’s tremendous progress on improving these most important components of human development, this well-balanced document also clearly identifies the remaining health, education, and poverty challenges for the poorest and most disadvantaged segments of the population.

• World Bank. China: Strategies for Reducing Poverty in the 1990s. Washington, DC: World Bank, 1992.

  Undertaken in close collaboration with the Chinese government’s Leading Group for Poverty Reduction, the World Bank’s first comprehensive examination of poverty and living standards in China establishes estimates of urban and rural poverty; reconfirms the geographic concentration of poverty in resource-deficient upland areas of western China, and the deplorable educational and health status of the poor; and recommends a multisectoral approach for the worst-affected areas.

• World Bank. China: Overcoming Rural Poverty. Washington, DC: World Bank, 2001.

  DOI: 10.1596/0-8213-4937-6

  The second major World Bank assessment of poverty in China, this document reconfirms the growing concentration of poverty in upland areas of the western provinces. Focused on the effectiveness and efficiency of China’s poverty reduction program, the study calls for increasing China’s official poverty line, targeting poor townships instead of poor counties, placing greater emphasis on participation, and several other reforms.

• Yan Ruizhen, and Wang Yuan. Poverty and Development: A Study of China’s Poor Areas. Beijing: New World, 1992.

  The most prolific proponents of the view that China’s poverty is highly geographically concentrated in mountainous and hilly areas, Yan and Wang argue that China’s poverty problem is the problem of its least-developed mountainous areas. This comprehensive analysis considers the extent, causes, and key features of poverty in the mountainous and hilly areas, and proposes a number of solutions.