Research On Adverse Selection And Moral Hazard In Government-directed Poverty Alleviation

China’s long-term government-led poverty alleviation project has achieved remarkable results and attracted worldwide attention.While the number of poor people has continued to decrease and the scale of poverty has narrowed significantly,the nature and characteristics of rural poverty have also undergone great changes,raising new challenges for anti-poverty measures.In November 2013,General Secretary Xi Jinping proposed “accurate poverty alleviation” when he was inspected in Xiangxi of Hunan Province.With the efforts of the central and local governments,the precision poverty alleviation work was quickly and fully carried out,and achieved remarkable results.However,some tricky problems have also been exposed in practical work,especially the adverse selection and moral hazard existing in the key links such as poverty identification,poverty alleviation and management exit.This not only reduces the effect of poverty reduction,but also very easy to form a "reverse incentive" with greater impact."Reverse incentives" have become the core problem of precision poverty alleviation.Based on the game theory and information economics related theories and methods,this paper theoretically studies the adverse selection and moral hazard formation in precision poverty alleviation through the construction of a game model,and conducts empirical studies on the resulting targeting errors.Non-poverty groups will use information advantages to release false poverty signals to gain the benefits of poverty-reducing resources,and there are prominent exclusions from poor households.In the phase of poverty alleviation and management exit,moral hazard occurs,the county-level government will use information advantage to deviate from provincial government’s goal of poverty alleviation,so that the poverty alleviation resources can be misappropriated and leaked out to other areas.Based on the mistakes made by poor household registration cards to indicate the degree of adverse selection and moral hazard in the government’s poverty alleviation process,the rate of error in poor household registration cards is 41%.The number of family laborers has a significant negative effect on the error in poor household registration cards.The average working years of the labor force,household population burden,and cultivated land area have a significant positive effect on the error in poor household registration cards.Finally,in the aspects of identification method,helping method,capital management,assessment and evaluation,this paper puts forward policy suggestions to solve the problem of adverse selection and moral hazard in government-led poverty alleviation.The current government’s poverty alleviation should improve the identification methods of poverty alleviation objects,improve the accuracy of identification,adapt measures to local conditions,improve the help methods of households and improve the effectiveness of resource assistance;strengthen the supervision of funds so that the funds can be put in place;improve assessment and evaluation mechanisms to achieve accurate poverty reduction,stability out of poverty.