Capabilities and Poverty: Examining Urban Poverty Issues in China

This case study examines the complexities of urban poverty in China, focusing on the capabilities approach. While China has made remarkable progress in poverty reduction, lifting millions out of extreme poverty through economic reforms, significant challenges remain. The study highlights issues such as increased income inequality, the widening rural-urban divide, and environmental degradation exacerbated by rapid industrialization. It analyzes how these factors impact the capabilities of urban residents to achieve a decent standard of living. Furthermore, the study proposes potential solutions, including investments in infrastructure and human capital, job quality improvements, and environmental protection policies, emphasizing the importance of sustainable and equitable development to address the multifaceted nature of urban poverty in China. Desklib offers a platform to explore more such solved assignments and past papers.

[CHINA: CONTINUES LARGEST POVERTY ALLEVIATION CAMPAiGN]

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Contents
Introduction...........................................................................................................................................2
Analysis of problem..............................................................................................................................3
Increased inequality...........................................................................................................................3
Rural-Urban Divide...........................................................................................................................4
The scarcity of Natural resources and environmental degradation........................................................4
Solution to the problems........................................................................................................................5
Conclusion.............................................................................................................................................6
References.............................................................................................................................................8

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Introduction
The topic that is been selected for this assignment is Capabilities and Poverty: Case study of
urban poverty in China. In China the poverty, mainly remain in the rural areas, in urban
areas the poverty has been eliminated with the help of economic growth. The dramatic
progress in the reduction of poverty has been seen in China over the past three decades.
According to the World Bank, around 500 million people in China were lifted out of the
extreme conditions of poverty, In 1981 the poverty rate in China was 88 per cent that is been
reduced to 6.5 per cent in 2012 (The World Bank, 2018). The poverty level in China was
measured by the percentage of people living on the equivalent of the US $1.90 or less per
day. Since the Deng Xiaoping started the instituting market reforms in the late 1970s, the
country has become a fastest grown economy in the world. The country has recorded a 10%
continuous growth in the gross domestic product (Xuequan, 2018). This growth had led
China toward a substantial increase in the living stands of the population and marked a
decline in the poverty. In between 1981 to 2008, the population of China who is earning
$1.25 per day or less has estimated to fall from 85 per cent to 13.1 per cent, approx. 600
million people have been removed from the poverty (Das, 2018). With the rapid
development in the country, the country has faced the various kinds of problems.
China has faced the problems of environmental degradation and natural resources scarcity.
The rapid development in the standard of living has raised the condition of disparities among
different parts of the country. The country also faces the problem of income inequality, the
inequality is not only seen at income level but is also seen at educational and health level.
The economy of China is decentralised were the responsibility of health and education is lies
on the government, the government of China is responsible for providing the fund related to
the health and education of the people (Weiping, 2018). The poor localities and rural areas

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have not able to avail these funds and are not able to afford the high cost of private health and
education instructions.
Since the economic reform in 1978 China has maintained a growth rate of more than 30 years
and this continues growth has increased the average living standards of the people of China.
In previous China has common characteristics with the rest of developing Asian countries
such as low per capita income, large population and scarcity of resources but in 15 years
China has made a drastic growth with average per capita growth of 8.7 per cent.
Analysis of problem
China emerged as a country that has reduced the level of poverty in the country and provides
good living standard to the population. Being a most populous country, this is the very big
achievement of the economy of China. By 2004, approx. 500 million people have climbed
out of the poverty. There is a common saying the positive things also bring some negative
aspects to them, the same thing happens with China. With the rapid economic growth and
drastic reduction, poverty has arisen some problems with it. Problems arise with the poverty
reduction are:
• The reduction in poverty arise the problem of Inequality
• The reduction in poverty increased a gap between Rural and urban areas and people or
divide rural and urban
• The availability of Natural resources also get affected and the environmental degradation
has increased.

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Increased inequality
The economic growth of China has shown the rapid development in the country and every
people has to get benefit out of it and the poverty also gets reduced. However, the benefit of
the economic growth and poverty reduction has reached to people in very different extent,
some of the people have got the full benefit out of the economic reform, some people have
got average benefits and some has got the very little benefit of the economic reform. Due to
the improper distribution of the benefits, the problem of inequality has raised. The problem of
inequality not only raised in the income distribution but inequality also has taken place in the
health care system and education system of the country. The Gini measure of inequality has
increased from .31 to .45 after the reform (Mei, 2016).
Rural-Urban Divide
With the reduction of poverty, the inequality has taken place in the economy and due to that
increased inequality levels, China has faced the problem of rural-urban division. The main
reason behind the rural-urban division is the unequal distribution of income between the rural
and urban areas. The survey conducted by households in 1995 showed that the gap between
the income level of the rural and urban area is accounted 35 per cent. According to the China
National Bureau of Statistic in 2009 the urban per capita annual income was at the US $2525
that is approx. three times more than the per capita annual income of the rural areas people
this was the largest gap recorded since 1978 (Yan and Fan, 2014). There is urban biased
economic policy is been adopted by the government that leads to the income disparities.
The scarcity of Natural resources and environmental degradation
To reduce the poverty in the country, China has utilised the maximum range of natural
resources and for the development and continues economic development the country has
developed the plan of industrialization due to which the problem of environmental

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degradation has occurred. China has considered being the most polluted country in the world
with the high in population the country is high in pollution. For the economic development
and poverty alleviation, the country did not put their focus on the scarcity of the natural
resources and on the environmental degradation (Si, Yu, Wu, Chen, Chen and Su, 2015).
Due to the improper development of the country leads the economy as the most polluted
economy of the world. Due to the high amount of pollution, many health problems have been
raised in the economy. The people of China were suffering from various kind of skin and
breathing related illness such as skin allergy, asthma etc.
Solution to the problems
China can solve the problem of inequality, rural-urban division and Scarcity of Natural
resources and environmental degradation by adopting these solutions:
The country can create jobs by investing in infrastructure: the country can create employment
opportunities by making the investment in renovating abandoned housing, developing
renewable energy sources, significantly increasing affordable housing investment and by
making other common sense investments (Rakodi, 2014).
Strengthen Families by improving job quality: the urban population of China are living the
good standard of living and to the inequality in the economy it becomes the necessary
requirement for the country to improve the living standard of the rural areas that China can
improve the condition of the rural people by improving the quality of job with increased pay
scale (Bene, et.al. 2016).
Invest in the Human Capital: to reduce the inequality in the economy China can make the
investment in expanding access to affordable and high quality of early education and
childcare. The country can create good pathways to the good jobs such as national subsidised

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jobs, national service opportunities and apprenticeships and by implementing education for
all to ensure that any student could not be left behind.
China can ensure disparity by taking care of employees or worker with disabilities, the
country can make sure that the people with the disabilities will get a fair chance of economic
security and employment.
China can remove the inequality by closing the loopholes of close taxes that are providing
benefits to the wealthy people.
China can expand the Medicaid and ensure that all the people of China get the affordable and
high-quality health treatment and coverage.
To control the environmental degradation it is important for China to spread awareness
among the people about the danger relates to the pollution and what measures the residents
has to follow to manage the conditions (Ward, 2016).
It is important for the Government of China to form policies related to the control of pollution
in the country because it is the right of the people of China to live in the fresh and healthy
employment.
To protect the environment from the Industrial and agricultural Pollution it is important for
the government to develop a policy which specifies the rules regarding the discharge of the
pollutant in water and air.
The natural resources are limited it is very important for every economy to preserve their
natural resources for the future generation. The chin has used their natural resources to the
higher extent now it is the responsibility of the government to direct the companies to use the
natural resources effectively and save it for future generation (Uddin, Shahbaz, Arouri, and
Teulon, 2014).

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Conclusion
To conclude, China is the developed nation and the status of the developed nation is been
attained by the country by developing the economic growth and by the reduction in poverty.
To develop the economy the country has used the natural resources to highest extent and
become the developed nation the country has set up various industries due to which the level
of air and water pollution has also increased. After attaining the economic growth the
country, get success in removing poverty but with the reduction in poverty the country has
faced various problems like inequality, rural-urban division and Scarcity of Natural resources
and environmental degradation and many more. Now it is a high time the country has
provides their focus on providing equal opportunities to the people rural areas and sustainable
development of the economy.

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References
Bene, C., Arthur, R., Norbury, H., Allison, E.H., Beveridge, M., Bush, S., Campling, L.,
Leschen, W., Little, D., Squires, D. and Thilsted, S.H., (2016). Contribution of fisheries and
aquaculture to food security and poverty reduction: assessing the current evidence. Journal
of World Development, 79, pp.177-196.
Das, S. (2018) Environmental Degradation [Online] Available from:
http://www.yourarticlelibrary.com/environment/environmental-degradation-reasons-effects-
and-suggestions/47533 [Accessed on: 9-9-2018].
Mei, L. (2016) China resettlement Poverty reduction. [Online] Available from:
http://conferences.ifpri.org/2020chinaconference/pdf/012LiuMei.pdf [Accessed on: 9-9-
2018].
Rakodi, C., (2014). Urban livelihoods: A people-centred approach to reducing poverty. U.K:
Routledge.
Si, S., Yu, X., Wu, A., Chen, S., Chen, S. and Su, Y., (2015). Entrepreneurship and poverty
reduction: A case study of Yiwu, China. Asia Pacific Journal of Management, 32(1), pp.119-
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Uddin, G.S., Shahbaz, M., Arouri, M. and Teulon, F., (2014). Financial development and
poverty reduction nexus: A cointegration and causality analysis in Bangladesh. Journal of
Economic Modelling, 36, pp.405-412.

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Ward, P.S., (2016). Transient poverty, poverty dynamics, and vulnerability to poverty: An
empirical analysis using a balanced panel from rural China. Journal of World
development, 78, pp.541-553.
Weiping, T. (2018) China Approach to Reduce Poverty: Target measures to lift people out of
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[Accessed on: 9-9-2018].
Xuequan, M. (2018) China continues largest poverty alleviation campaign in history.
[Online] Available from: http://www.xinhuanet.com/english/2018-03/05/c_137018278.htm
[Accessed on: 9-9-2018].
Yan, D. and Fan, H. (2014) Infrastructure, growth and poverty reduction in China. [Online]
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