Topic: Village Insurance in a Growing China

Speaker: Yu Zheng,  City University of Hong Kong 

Time: March 20th, 2018 13:30–15:00

Venue: Conference Room 106B, Zhonghui Building (College of Economics, JNU)

About the speaker:

Yu Zheng is an Assistant Professor at the Department of Economics and Finance in the City University of Hong Kong. She works on topics in macroeconomics, development economics, and labor economics. In her current work, she explores the micro-level income risks and risk sharing institutions in a developing or growing economy. Her work appears in international peer-reviewed journals such as Macroeconomic Dynamics, Journal of Political Economy, and the American Economic Journal: Macroeconomics, and the Quantitative Economics.

Abstract:

Over the past three decades, China has transformed itself from a centrally planned economy to a mixed economy, where markets play an increasingly important role in resource allocation. As individuals responded to the economic opportunities brought by the markets, the communal relationship that was woven into the social safety net in the 1980s and 1990s slowly disintegrated. In this paper, we document how the degree of consumption insurance against village-aggregate and idiosyncratic income risks has changed over time, for a panel of Chinese households living in 150 villages over the period of 1989 to 2009. We show the decline in the consumption insurance is closely related to economic transformations that took place in rural villages: the shift of working-age population from agriculture to employed, and often migrant, jobs, the decline of the Township-and-Village Enterprises and the national development strategy that favored growth over equity. We provide evidence in support of this interpretation by exploiting the regional heterogeneity in growth experience in the data.