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Does Decisionmaking of Grassroots Fiscal Expenditure Favor the Poor?——Evidence from Tracking Investigation of the Chinese Countryside Families

【Authors】
CUI Jinghua, LI Wanfu & XIE Yuantao
【WorkUnit】
CUI Jinghua(University of International Business & Economics, 100029)
LI Wanfu(State Administration of Taxation, 100038)
XIE Yuantao(University of International Business & Economics, 100029)
【Abstract】

Grassroots public spending decisions play important roles in low-income people's welfare level and the occurrence probability of poverty. This paper adopted logit model and instrumental variable method to test how the rural fiscal expenditure impacted on poor rural families in China by the panel data of village, family and adult in CFPS in 2010 and 2014. The whole sample empirical analysis result showed that the effect of per person education spending on decreasing impoverishment rate was the greatest, followed by productive investment of agriculture and water conservancy. The bigger the villager's expenditure and administrative cost directly allocated by village finance, the higher the poor probabilities occurred. Villagers expenditure directly allocated by the village finance had more influential than the administrative cost on poor. The impact of the fiscal expenditure on the probabilities of poor occurrence had obvious heterogeneous distributions with different of years of education, gender, average age. There was no significant difference regression conclusion of subgroup regression and whole sample regression Given that, in the formulation of pro-poor policy process we should emphasize the personality traits of all households and implement precisely identify, accurately help and precisely management. We should moderate increasing more education spending, the scale and ratio of investment in the agriculture and water infrastructure. Simple and extensive and single subsidization must end. It is vitally important to enhance the “blood making” capacity of the poor families in favor of alleviating the rural poverty problems.

JEL: H20, H60, F18

【KeyWords】
Rural Households, Poverty Rate, Village Fiscal Expenditure, Production Investment, Education Spending