Page 6 - HKUST IEMS Spring 2018 Newsletter
P. 6

DESIGNING A POVERTY REDUCTION STRATEGY - CHINA AND
   AFRICA'S EXPERIENCES

                                                                      work. Additionally, China’s unique
                                                                      political system and institutional
                                                                      regimen renders these precision
                                                                      poverty programs difficult to duplicate
                                                                      in other developing countries.

   Photo by Samuel Vigier / Flickr. CC. https://flic.kr/p/c3ix1b                                      In his academic seminar, Imran Rasul
                                                                                                      (University College London) presented
   China has achieved remarkable progress in poverty reduction                                        research on the role of delivery agents
   since the early 1980s. More than 800 million people living                                         in the delivery of poverty alleviation
   under US$1.9 a day have been lifted out of poverty and                                             programs in Western Uganda. The
   China’s contribution to reducing the rate of global poverty                                        study identifies the delivery agent's
   exceeded 70 percent. However, with the slowdown of                                                 social ties to potential recipients and the
   economic growth and increase of income inequality, over                                            social context in which they operate as
   time, the accuracy of targeting has deteriorated and the                                           the key determinants of their behavior.
   measured impact of the programs on rural income growth has
   declined. China needs to reform its targeted poverty reduction     Many development organizations use delivery agents to allocate
   strategies to enable the poor to benefit more from poverty         scarce resources across recipients. These agents often have
   reduction interventions. In November 2013, President Xi            social ties to some recipients and not others, which can lead to
   Jinping proposed the strategy of “precision poverty alleviation”   biased allocations. Rasul studies these issues in the context of
   during his visit to western Hunan, and the strategy has            an anti-poverty program in Western Uganda. A total of 4,741
   become a significant part of China’s effort to end extreme         farmers from 168 villages were surveyed with regards to their
   poverty by 2020. In his academic seminar, Sangui Wang              knowledge and adoption of improved seeds and modern
   (Renmin University of China) summarized the main policies          techniques. BRAC (an NGO), offers a program delivered by
   and practices implemented under this strategy in recent years      locally recruited agents tasked to sell improved seeds to farmers
   and discussed the progress made and the challenges that this       and train poor farmers in modern techniques.
   effort faces.
                                                                      The study found that delivery agents were significantly more
   Precision poverty alleviation aims to eradicate extreme            likely to target households to which they are socially tied than
   poverty of under $2.3 dollars a day by 2020 by targeting           those in rival groups, a distinction exacerbated in villages where
   poor households and individuals as opposed to promoting            inter-group conflict is most salient.
   regional development of poverty-stricken areas. Precision
   poverty alleviation includes accurate identification, assistance,  The study also found that greater conflict between groups can
   management and assessment through which China has been             enhance targeting within groups by delivery agents (parochial
   able to identify 29.48 million poor households with a total        altruism). Such behaviors will potentially skew the allocation
   population of 89.62 million as targets for poverty alleviation     of the program and therefore, need to be taken into account
   programs in 2013 – a figure that dropped to 43.33 million          when designing programs, recruiting delivery agents and
   by the end of 2016. China has seen a dramatic reduction in         incentivizing agents. Development programs that use locally
   poverty since the reform which has been in part, a result of       hired agents need to account for the network structure of the
   fast and sustained economic growth, specifically, agricultural     agents they employ. This network structure not only includes
   growth. Targeted poverty alleviation efforts have also             their social ties and connections to their “in-group”, but also the
   helped to narrow the gap between different regions and the         groups they are not connected to.
   establishment of a social security system in rural areas since
   2007 has accelerated economic and social development                  Academic Seminar, “Accurate Household
   of poverty stricken areas in China. However, the high                 Targeting: China’s New Anti-Poverty
   administrative cost and coordination challenges involved in           Strategy” by Sangui Wang (Renmin
   delivering these precision poverty programs has led to over           University of China) on 2017.09.27
   investment in some areas of China which in turn produces              Video and slides available at
   negative effects as the poor are no longer incentivized to            http://iems.ust.hk/targeting

                                                                         Academic Seminar, “Delivery Agents,
                                                                         Social Ties and Group Identity” Imran
                                                                         Rasul (University College London) on
                                                                         2017.09.27
                                                                         More information available at
                                                                         http://iems.ust.hk/rasul

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