Trade Liberalization And Poverty In Rural China

Since the reform and opening, China’s economic developed rapidly, China’s poverty reduction made remarkable achievements. According to "World Development Indicators" report of the World Bank, April 17,2013 release, said China accounted for the total number of the world’s extremely poor people in extreme poverty declined from 43% in 1981 to 13% in 2010, which make a great contribution to the reduction of global poverty. In China, which is based on agriculture, the most worthy of attention is rural poverty. "China Rural Poverty Monitoring Report" shows that, according to low-income poverty standard promulgated by China’s annual basis, the incidence of rural poverty declined from 10.2 percent in 2000 to 2.8% in 2010. But in 21st century, because of the extent of China’s accession to WTO makes trade liberalization gradually deepened, but the magnitude of reduction in absolute poverty in rural areas is increasingly slowing down, or even returning to poverty; and the depth of poverty, the intensity of poverty is increasing, the poorest of rural poverty grow poorer.It is a matter of concern that the rapid development of trade and exacerbation of rural poverty is in coincidence in time or there is some inherent relationship between them. There are many analysis on the factors impact rural poverty over the years, but generally the indicators to measure poverty in rural areas is around the incidence of poverty, which can only reflect the proportion of the poor in rural area, and is completely insensitive for the distribution of its income, and ignor the interests of the poorest with a somewhat misleading in the anti-poverty policy. Since those who stay away from the destitute poverty line is precisely the social groups which is in most need of attention, so we introduce the other two indicators, the depth of rural poverty and the severity of rural poverty, for the full measure of poverty in rural China.Since this study is primarily about the effect of trade liberalization on poverty in rural areas, while the different geographical location between coastal and inland areas in China causes different natural resources, labor force, quality and the degree of its liquidity, which decides the inconsistencies in the structure and extent of their payrolls on the transfer of agricultural production, and because of the different degree of trade liberalization, this will cause varying degrees of influence on rural poverty incidence, poverty depth and poverty severity in different regions. Therefore, this paper carried out the study by sub-regions based on geographical characteristics of provinces. Based on the availability of data, this paper selected research areas include six coastal provinces:Liaoning, Hebei, Jiangsu, Zhejiang, Fujian, Guangxi; and seven inland provinces:Anhui, Henan, Heilongjiang, Hubei, Jiangxi, Inner Mongolia, Shanxi. All variables were done in accordance with the two regions panel data processing, the use of the statistical yearbook of farmers per capita net income of packet data, research impact of trade liberalization on rural poverty in different regions in three areas since joining WTO (2001-2011).We can get the following conclusions from the above study:1.In this study, the rural poverty rate showed a downward trend in both inland and coastal areas, but relatively speaking, the incidence of poverty of inland provinces in rural areas is closer, and has greater volatility, this volatility into poverty phenomenon is more frequent, the trend in coastal areas is relatively constant. The depth and severity of poverty increase by varying degrees, with an deepened level of poverty, and poor internal income distribution more uneven.2.Trade liberalization reduced the incidence of poverty in rural China, but significantly deepened the poverty depth and poverty severity.3.Sub-regional study shows that the impact of trade liberalization on poverty incidence in rural coastal areas is not significant, but has significantly reducing influence in rural inland areas.4.Sub-regional study shows that trade liberalization have significantly increased the poverty depth and poverty severity of rural areas in both coastal and inland areas, but the influence in the coastal areas is greater. This shows that with the same extent of increasing of trade liberalization in different regions, there will be more general worsening poverty levels of the rural poor in coastal areas, the income gap between the coastal pull the rural poor interior, so that the overall level of poverty deepen more in coastal areas than inland areas, the internal distribution of income of the poor in coastal areas is also more uneven than in inland areas.