The impact and effectiveness of China’s entrepreneurship policy for back-home migrant workers

Abstract

This study aims to estimate the net effect of China’s entrepreneurship policy on back-home migrant workers since 2015. Using survey data from the provinces of; Zhejiang, Henan, and Guizhou with propensity score matching to control selection bias, the study indicates that the overall entrepreneurship policy has a significant positive impact on the probability of entrepreneurial entry. The poverty alleviation effect of the overall policy is greater than its industrial development effect, while the employment effect is not significant. The infrastructure policy’s effect on employment, industrial development, and poverty alleviation is greater than the other policies, and the financial policy’s effect on these three aspects is not significant. This study contributes to the existing literature by addressing a well-defined gap regarding the net effect of entrepreneurship policy on entrepreneurship entry and provides well-supported and plausible explanations for the inconsistencies among previous studies on policy effect indicators. As a practical contribution, this study provides China and other developing economies with compelling empirical evidence to support the design and amendment of entrepreneurship policy at the national level.