Targeted Cash Transfers, Credit Constraints, and Ethnic Migration in the People’s Republic of China | Asian Development Bank

Targeted Cash Transfers, Credit Constraints, and Ethnic Migration in the People’s Republic of China

Publication | April 2019
Targeted Cash Transfers, Credit Constraints, and Ethnic Migration in the People’s Republic of China

This paper studies the effects of targeted cash transfers on rural–urban migration of Han and ethnic minority households in the People’s Republic of China.

It examines the Dibao antipoverty program using an instrumental variable framework. The findings imply that once liquidity is injected into a village it is circulated informally, which stimulates migration–particularly among credit-constrained minority communities. Overall, the cash transfer program spurs migration through these indirect or spillover effects, which are twice as large for ethnic minorities as for the Han majority.

Contents 

  • Introduction
  • Minimum Living Standard Assistance Program Background
  • Data
  • Empirical Framework
  • Results
  • Comparing the Direct and Indirect Program Effects on Migration
  • Conclusion
  • Appendixes