Targeting performance of Dibao program in China: An empirical study based on the 2020 China Family Panel Studies

Abstract

The rural minimum living security (Dibao) Program is regarded as an essential means to alleviating absolute poverty in rural areas. This study uses logistic regression to identify the influencing factors for the distribution of Dibao subsidies based on the CFPS 2020 database covering 28 provinces in China. Then, we categorize the sample into four types of households to further analyze the targeting performance of Dibao program with the method of multiple logit regression. The results reveal that the living standards of households, such as public facilities, drinking water, cooking fuel, housing value, and assets can impact the distribution and targeting performance of Dibao subsidies. Having educational burdens can significantly increase the probability of being covered by Dibao program for non-low-income households. Large family-size households that are involved in agricultural-related work and use electricity or other fuels for cooking are more likely to receive Dibao subsidies. When compared with the eastern region, households in the western region are more likely to gain Dibao subsidies. The results of propensity scores reveal that the contemporary mismatch of the rural minimum living security system has been overestimated in many research by simply treating non-low-income households that receive Dibao. However, the inclusionary targeting errors are still high (76%), which might indicate that there are still shortcomings in the targeting mechanism for the rural minimum subsistence allowance system. The research findings generate useful implications for policymakers to improve the accuracy in allocating rural Dibao subsidies.