As first author of the paper “A multifaceted poverty reduction program has economic and behavioral consequences”, Researcher LI Wenchao from the Department of Economics and Finance of Tongji SEM has co-authored a paper with LENG Zhiming, YI Junjian, and ZHONG Songfa in the world-renowned journal PNAS (Proceedings of the National Academy of Sciences of the United States of America). The paper provides a broader perspective for evaluating poverty reduction interventions by examining how poverty reduction affects social preferences and the quality of decision-making.

PNAS is one of the most cited general interest journals and is recognized as one of the world’s top four journals (Cell, Nature, Science, PNAS).

Periodical：Proceedings of the National Academy of Sciences of the United States of America

Author: Wenchao Li, Zhiming Leng, Junjian Yi, Songfa Zhong

Key words: Social Preferences; Revealed Preference Analysis; Poverty Reduction; Development; Lab-in-The-Field Experiment

An introduction to the main content of the paper:

There is a growing interest in the relationship between social preferences and income. This study aims to improve the unbiased understanding about the mechanisms of preference formation in resource allocation by examining how poverty reduction affects these preferences. Based on a comprehensive poverty reduction project in China (“Precision Poverty Reduction”), this paper uses a Fuzzy Regression Discontinuity Design to compare the economic and behavioural aspects of households above and below a predefined income standard. The study finds that after five years, households receiving assistance from the project experienced a 50% increase in income; at the same time, the quality of decision making by the household improved, efficiency preferences increased, selfishness decreased, and equality preferences remained unchanged.

This study provides an in-depth exploration of the relationship between poverty reduction and social preferences, specifically examining the causal impact of poverty reduction interventions on social preferences. Through comprehensive research and analysis, this paper concludes that these poverty reduction policies have not only had significant effects at the economic level, but have also had far-reaching effects at the behavioural level. These findings not only help to deepen the understanding of the mechanism of social preference formation, but also provide a broader perspective for evaluating various poverty reduction interventions, which is of great theoretical and practical significance.

Research Experience Sharing:

LI Wenchao has been focusing on research in the related fields of Labour Economics and Development Economics. Based on the core issues of sustainable economic growth and harmonious social development since China’s Reform and Opening-up, she uses mainstream and cutting-edge economic tools to explain the facts of China’s characteristics, and seeks to promote China’s development and governance experience and wisdom to the international community.

Faculty Profile

LI Wenchao

TONGJI_SEM

Researcher in the Department of Economics and Finance of Tongji SEM. She holds a Bachelor’s degree with 1^st Class Honor and a PhD in Economics from the National University of Singapore. Her papers have been published in Journal of Political Economy, PNAS, Journal of Labour Economics, Journal of Development Economics, Economic Journal, Journal of Human Resources and Journal of Business Venturing, etc. She is chair of a Youth project of the National Natural Science Foundation of China. She was selected for the “Shanghai Pujiang Program”. She is an invited reviewer for Journal of Labour Economics, Journal of Human Resources, Management Science, Economic Modelling and other academic journals.

Research areas: Labour Economics, Development Economics