Unconditional Cash Transfers in China: Who Benefits from the Rural Minimum Living Standard Guarantee (Dibao) Program?

The focus of this study is a large targeted cash transfer program in China, the rural minimum living standard guarantee or “dibao” program. China’s rural dibao program aims in principle to provide cash supplements to households with income below specified income thresholds. The transfers are unconditional, that is, beneficiaries are not required to fulfill any conditions in order to receive the transfer. The program is part of a multipronged effort since the late 1990s to rebuild rural social programs and address the changing structure of rural poverty (Lin and Wong 2012, World Bank 2009). Following substantial poverty reduction in the 1980s and 1990s, poverty in rural China became more dispersed geographically, and transitory poverty emerged as a new challenge (Lin and Wong 2012, World Bank 2009). These changes led China to shift away from its earlier “poor area” poverty alleviation program and adopt the dibao program, which targets households wherever they reside and, in principle, provides transfers based on either temporary or chronic income shortfalls.