A Research On The Impact Of Mass Entrepreneurship On Poverty Reduction Effect In China

As the largest developing country in the world,poverty reduction is an important task of the Chinese government.The tough battle against poverty,which began at the 18 th National Congress of the Communist Party of China in November 2012,ended perfectly in 2020 and solved the problem of absolute poverty that has plagued China for thousands of years,but the problem of relative poverty in China will still exist for a long time.Therefore,it is of great significance to explore effective measures for poverty reduction to consolidate existing achievements and win the battle against poverty.Distinguishing existing literature,this thesis mainly studies the important influence mechanism and effect of mass entrepreneurship on poverty reduction from a macro perspective by combining theoretical and empirical methods,so as to provide theoretical basis and empirical support for the government to realize multi-dimensional poverty reduction by promoting mass entrepreneurship.On the basis of literature research,this thesis proposes that,at the macro level,people’s entrepreneurship plays a role in poverty reduction mainly by promoting economic growth,increasing employment creation,breaking the chain of poverty occurrence and accelerating social development.Moreover,this thesis also suggests that labor market segmentation can weaken the poverty reduction effect of entrepreneurship by inhibiting labor mobility,increasing the cost of entrepreneurship and inhibiting the accumulation of human capital.Therefore,it is crucial for the government to further promote market-oriented reform in the process of promoting people’s entrepreneurship.The research contents and conclusions of this thesis are summarized as follows:Firstly,literature review and theoretical basis,mainly from the two aspects of entrepreneurship and poverty reduction.The literature review part is about the research on entrepreneurship of the people,including the research on the measurement of entrepreneurship level,the research on the influencing factors of entrepreneurship,and the research on the impact of entrepreneurship on economic development.Research on poverty reduction,including research on poverty measurement,research on the causes of poverty,research on poverty alleviation strategies and poverty reduction effects.In the theoretical basis part,including about the poverty theory,the ability poverty theory,the poverty vicious circle theory,the social exclusion theory and the social development theory.As for entrepreneurship theory,it introduces the entrepreneurship theory and innovation entrepreneurship theory.Through literature review and theoretical basis research,it lays the foundation for finding the research starting point and research direction of this thesis.Secondly,research on the impact mechanism of mass entrepreneurship on poverty reduction.Based on the relevant concepts,this part first sorted out four channels of mass entrepreneurship on poverty reduction through literature analysis.Then,based on Lucas(1978)’s model of labor force career choice,a simple theoretical model was built to further analyze the impact of entrepreneurship on poverty reduction and social welfare.So as to lay a solid theoretical foundation for the follow-up empirical research.Thirdly,empirical analysis of the impact of mass entrepreneurship on poverty reduction.First,this chapter uses the GMM method to linearly analyze the impact of mass entrepreneurship on poverty reduction.Then,the mediating model is used to examine the internal mechanism of action of people’s entrepreneurship to reduce poverty.Finally,the dynamic threshold regression was used to analyze the nonlinear effect of people’s entrepreneurship on poverty reduction with the inclusion financial and institutional quality as the threshold.The study found that both absolute and relative poverty indicators were significantly reduced by mass entrepreneurship,but the positive effect of mass entrepreneurship on the extremely poor population was less than that of the general poor population.According to the regional test,people in eastern China are the most likely to reduce absolute poverty and relative poverty,while those in central and western China are relatively small.The empirical test of multidimensional poverty shows that the enhancement of mass entrepreneurship is indeed conducive to reducing income poverty and education poverty,but the effect of mass entrepreneurship on education poverty is much smaller than that on income poverty.Only the composite index of entrepreneurship had a significant reduction in medical poverty,but only a small one,and in the eastern region,the effect of people’s entrepreneurship on multidimensional poverty reduction is the most prominent.Through the intermediary model test,it is found that people’s entrepreneurship affects the incidence of poverty through economic growth,employment level,human capital,financial capacity,industrialization,urbanization and other channels,but there are some differences in these mechanisms.Nonlinear study found that people venture to rural income poverty three indicators of the provinces in our country and the dynamic nonlinear multidimensional poverty are significant influence,in the low level of inclusion financial development and the low institutional quality,weak mass entrepreneurship weakening function of rural poverty,even was not significant,but after the break through the threshold are displayed on the reduction functions of rural poverty significantly.Further distinguishing survival entrepreneurship and opportunistic entrepreneurship,we find that opportunistic entrepreneurship has a significant effect on reducing rural income poverty,education poverty and medical poverty in both low and high district systems.However,the effect of survival entrepreneurship on the reduction of multi-dimensional poverty in rural areas is even weaker.Fourthly,the exogenous impact brought by the creation of "National Entrepreneurial City" is taken as a natural experiment,and the difference-in-differences method is adopted to test the impact of people’s entrepreneurship on poverty reduction.Both the general difference-in-differences method and the propensity score matching multiplier method test confirm that the creation of "National Entrepreneur City" has a positive promoting effect on poverty reduction.After the establishment of "National Entrepreneur City",the poverty reduction effect of this activity gradually increases with time until 2013,but after 2014,the promoting effect decreases.The positive effect was most prominent in the middle city group.The western city group was the second.The provincial capital city group had the highest positive effect,followed by the general prefecture-level city group,and the positive effect of the cities separately listed in the plan and the sub-provincial city group was the least.Moreover,the industrial agglomeration,human capital level and market potential of cities are conducive to enhancing the poverty reduction effect brought by the establishment of national entrepreneurial cities.Fifthly,the empirical test of the impact of labor market segmentation on the poverty reduction effect of entrepreneurship.On the basis of theoretical analysis,the spatial dynamic panel model is used to investigate the impact of labor market segmentation on poverty reduction effect of people’s entrepreneurship based on the panel data of provincial level in China.The results show that labor market segmentation weakens the poverty reduction effect of entrepreneurship in the three regions,and the weakening effect of labor market segmentation is the most prominent in the western region.Labor market segmentation has a significant negative effect on economic poverty reduction,education poverty reduction,medical poverty reduction and life poverty reduction by inhibiting entrepreneurship.Among them,the negative effect of medical poverty reduction and educational poverty reduction is the largest.Sixthly,conclusions and policy implications.On the basis of the conclusion,this part puts forward the policy enlightenment of this thesis.This thesis proposes that active measures should be taken to continue to promote people’s entrepreneurship in order to reduce rural poverty.The government should pay attention to the support to the extremely poor population;the government will further improve the Inclusive finance and raise the quality of regional systems.We should pay attention to the reduction of poverty in the areas of education and medical care for rural residents.Policy inspirations include promoting labor market reform and promoting the free flow of labor.The research in this thesis can enrich the deficiency of research literature on the relationship between entrepreneurship and poverty reduction,provide an important policy reference for the government to reduce relative poverty and multidimensional poverty by promoting entrepreneurship,and provide theoretical basis and empirical support for the government to promote market reform to improve the poverty reduction effect of entrepreneurship.At the same time,as a summary of China’s practical experience in poverty reduction,this study can also provide useful reference for other countries in rural poverty reduction.