The Internal Logic of Poverty-Returning: Theory and Verification of Vulnerable Poverty Alleviation

Abstract

Since the implementation of the accurate poverty alleviation policy, the number of poor people in China has been shrinking, but the phenomenon of returning to poverty also occurs from time to time. To ensure that everyone is out of poverty, preventing and eliminating poverty-returning after out of poverty must be the key work in the current stage of poverty alleviation. To this end, this paper discusses the reason why there is the phenomenon of poverty-returning after out of poverty as well as the temporary poverty reduction. This paper innovatively proposes the theory of vulnerable poverty alleviation to explain it, verifies the theory by empirical analysis, and further demonstrates how to prevent the problem of poverty-returning after out of poverty. This is not only a necessary measure to consolidate the existing achievements in poverty alleviation, and achieve the goal of building a well-off society in an all-round way, but also a practical problem that needs to be highly valued in consolidating the achievements in poverty alleviation after 2020.After the poor have been lifted out of poverty, when they are affected by other external events, they are likely to return to poverty again if lacking the buffering and protection of assets, vice versa. Therefore, the situation that the family transfers from poverty to non-poverty but with no assets or few assets is called vulnerable poverty alleviation in this paper. Then the paper uses the three rounds of micro-survey data from 2010 to 2014 provided by China Family Panel Survey（CFPS）to verify it. Firstly, the propensity score matching method is used to verify the effect of asset endowment on reducing the probability of returning to poverty. Then the conditional Markov model” is constructed to explore the impact of different types of asset endowment on the state of poverty alleviation—poverty-returning” under the general scenario and risk shock scenarios. Finally, the path that out of poverty but not return to poverty is discussed.The results indicate that there is a significant difference in the probability of returning to poverty among families with different asset endowment. The fewer assets a family owns, the more likely it is to return to poverty, so asset endowment can prevent the phenomenon of returning to poverty. Specifically, production assets, financial assets, self-use assets and human assets endowments can inhibit the occurrence of returning to poverty. Among them, the role of production assets is most significant, and asset endowment plays the most significant role in preventing families from returning from mild poverty alleviation to shallow poverty, and asset endowment will play a more important role in risk shock scenarios than the general scenario. The role of asset endowment will be weakened if there exists a perfect public service system and high welfare for a region or borrowing behavior for an individual. This shows that the perfect public service system and the higher transfer payment in the high welfare area also play the role of safety net”, replacing the role of assets in alleviating the phenomenon of returning to poverty.Therefore, this paper argues that the government should incorporate asset indicators into the dynamic adjustment system of poverty identification; meanwhile, it should further improve the public welfare system, fundamentally encourage poor families to engage in production and business activities, and implement skill training, which will help to consolidate the achievements of poverty alleviation.