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Economic Restructuring, Informal Jobs and Pro-poor Growth in Urban China

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Based on household survey datasets and the framework of pro-poor growth, the present paper discusses how economic growth and inequality affect poverty reduction in urban China. The findings in this paper suggest that the poor benefit from economic growth through the trickle-down effect, but that the poor benefit disproportionally less than the nonpoor in both periods, from 1988 to 1995 and from 1995 to 2002; however, in the latter period, the pro-poorness is higher than that of the former period. Using the principle of Shapley decomposition, this paper develops an index of pro-poor growth for each income component, and finds that the income from informal jobs is the main contributor to the pro-poorness of growth during the period 1995 to 2002.
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Keywords: D31; I32; P36; Shapley decomposition; poverty; pro-poor growth

Document Type: Research Article

Publication date: March 1, 2011

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