Abstract:

Based on data from the Chinese Household Finance Survey (CHFS), this article investigates the impact of the rural medical assistance system on multidimensional poverty and the mechanism behind it. We find that the rural medical assistance system effectively alleviates absolute poverty, but has limited improvement on multidimensional poverty. The synergistic effect of commercial health insurance and rural medical assistance system has not significantly alleviated multidimensional poverty. The imperfection of the system has led households crowd out net assets and human capital, widening consumption inequality, and limiting its role in alleviating multidimensional poverty. The system has not caused serious ex-ante moral hazard, while the increase in medical expenses reflects both ex-post moral hazard and the result of the release of medical demand. The impact of rural medical assistance system on multidimensional poverty varies heterogeneously among families with different health conditions and age structures. The research provides policy insights for the improvement of the rural medical assistance system.

Key words:

rural medical assistance system, multidimensional poverty, compensation effect, erosion effect, moral hazard