| Abstract: |
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. |