Impacts of the COVID-19 pandemic on rural poverty and policy responses in China

Given the sudden outbreak of the COVID-19 pandemic, a timely study on the impacts of and policy response to the pandemic on rural poverty in China is critically important because China has aimed to completely eradicate extreme poverty by the end of 2020. This paper uses data from the latest round of a nationally representative household panel survey to examine the impacts of the pandemic on rural poverty in China. Our data show that 11.9% of sample households were ever officially registered as poor households between 2013 and 2019, and this poverty incidence fell to 2.7% by the end of 2019. In the middle February of 2020, 23% of the households who have graduated from poverty since 2013 perceived that they would fall back into poverty due to the COVID-19. Among those never poor households, 7.1% perceived that they would possibly fall into poverty due to the pandemic. Results from both descriptive and multivariate analyses consistently show the interruptions that the pandemic caused in off-farm employment is an important channel that led households to perceive of falling back into or falling into poverty. We also find households in the bottom four quintiles when ranked in terms of household income per capita are much more likely to perceive themselves of falling back into or falling into poverty during this pandemic than those in the richest quintile. Meanwhile, our results show that the education and age of household heads, as well as being from Hubei Province matter in explaining household perception about falling back into or falling into poverty in some cases but not all. The paper concludes with a set of policy responses that China has taken to mitigate the impact of COVID-19 pandemic on poverty alleviation.