Does targeted poverty alleviation policy lead to happy life? Evidence from rural China

• Published in: China economic review 2023-10, Vol.81, p.102037, Article 102037
• Main Authors: Zhou, Yunbo, Huang, Xingzi, Shen, Yangyang, Tian, Liu
• Format: Article
• Language: English
• Subjects: Policy evaluation; Rural China; Subjective well-being; Targeted poverty alleviation policy
• ISSN: 1043-951X; 1873-7781
• DOI: 10.1016/j.chieco.2023.102037

Based on 2013–2019 data from the China Household Finance Survey, we used the difference-in-differences method to systematically and quantitatively analyze the relationship between a targeted poverty alleviation policy and the rural poor's subjective well-being in China. The results showed that the targeted poverty alleviation policy has a spillover effect of improving rural poor households' happiness. Mechanism analysis found that the increment of both material and non-material welfare dimensions, as well as the building of positive attitudes during the process of policy implementation improve the rural poor's happiness status. Heterogeneity analysis shows that “hematopoietic” poverty alleviation policies have significant effects on the subjective well-being of all poor households, while “blood transfusion” policies have more significant effects on the subjective well-being of poverty caused by illness and old age. •The Targeted Poverty Alleviation (TPA) policy helps to improve the poor's happiness.•Material and non-material, and confidence improvement are key welfare dimensions.•Severe poverty households receive greater benefits from the TPA policy.•“Hematopoietic” policy has positive effects on the happiness of all poor households.•“Blood transfusion” policy improves the happiness of poor households lacking labor.