Growing Apart: Declining Within- and Across-Locality Insurance in Rural China
We consider risk sharing in rural China during its rapid economic transformation from the late 1980s through the late 2000s. We document an erosion of consumption insurance against both household-level idiosyncratic and village-level aggregate income shocks, and show that this decline is related to observable economic changes: the shift out of agriculture, the decline of publicly owned Township-and-Village Enterprises, and increased migrant work. Further evidence suggests that as these changes took place at the village level, higher levels of government failed to offset these effects through the tax-and-transfer system, leaving households more exposed to both idiosyncratic and village-aggregate risk.
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Copy CitationOrazio Attanasio, Costas Meghir, Corina Mommaerts, and Yu Zheng, "Growing Apart: Declining Within- and Across-Locality Insurance in Rural China," NBER Working Paper 30143 (2022), https://doi.org/10.3386/w30143.Download Citation
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Published Versions
Orazio Attanasio & Costas Meghir & Corina Mommaerts & Yu Zheng, 2025. "Growing apart: Declining within- and across-locality insurance in rural China," Journal of Development Economics, vol 172.
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