Rural transformation, income growth, and poverty reduction by region in China in the past four decades

China has experienced rapid rural transformation in the past four decades. Accompanying the rapid transformation are a significant rise in rural household income and substantial fall in rural poverty. In this paper, we examine the evolutions of and the relationships between rural transformation (high-value agriculture and rural non-farm employment) and its outcomes (per capita rural income and rural poverty incidence) by using provincial level data. The results show that all provinces have undergone significant rural transformation, but the level and speed of rural transformation differed considerably. Moreover, higher level of rural transformation is often positively associated with higher level of per capital rural income and lower level of rural poverty incidence. Notably, a category of provincial rural transformation based on high-value agriculture and rural non-farm employment is also analyzed. This paper further discusses the likely impacts of institutions, policies and investments (IPIs) on rural transformation and concludes policy implications.