Ziyuan Kexue (May 2024)
Impact of government assistance on the relative deprivation of poor households’ consumption: Policy evaluation based on the targeted poverty alleviation program
Abstract
[Objective] The targeted poverty alleviation program has, overall, elevated the social welfare of impoverished households. However, the role of the targeted poverty alleviation program plays in improving households’ relative welfare, such as relative deprivation of consumption, remains a subject for discussion. The answer to this question carries significant implications for improving the quality and efficiency of government assistance policies. [Methods] Based on the China Household Finance Survey (CHFS) data from 2013 to 2019, this study calculated the relative deprivation of household consumption using the Kakwani index for the surveyed households residing in a city (or province). Then, using the difference-in-differences method, this study examined the impact of the targeted poverty alleviation program on the relative consumption deprivation of poor households. Finally, employing heterogeneity analysis of the causes of poverty, as well as consumption categorization and an interactive model of poverty alleviation styles, this study tested the effect of the government targeted poverty alleviation program on the relative deprivation of household consumptions. [Results] The targeted poverty alleviation program has generally reduced the relative deprivation of consumption for impoverished households, albeit having a relatively weak economic effect. This result remains valid even after a series of placebo-tests and regressing on a matched sample set. Further classification and scrutiny of the consumption types, poverty alleviation styles, and causes of poverty revealed that poverty-stricken households experienced a significant reduction in relative deprivation of consumption in the healthcare expenditure and education expenditure. This is because the welfare type poverty alleviation policies such as medical support, housing and living assistance, and children’s education support significantly enhanced the consumption welfare of poor households. However, no statistically significant effect was found in other development assistance type poverty alleviation policies. [Conclusion] The impact of the targeted poverty alleviation program on household relative consumption deprivation was generally weak, and was concentrated in protection-oriented poverty alleviation policies, such as medical support and educational assistance. In the future, government assistance needs to enhance efficiency and optimization in development-oriented policies.
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