Paired Assistance: Policy Rationale andEconomic Performance as Illustrated byXizang and Xinjiang

Li Xihui1, Wang Guiduo1, Duan Pengfei1,2*, Huang Jixin1

1 Minzu University of China, Beijing, China

2 Pu’er University, Pu’er, China

Abstract: This study highlights the changing priorities of China’s paired assistancethroughout the past decades, as well as its theoretical implications and economic growtheffects for recipient regions. Using panel data from 32 prefecture-level cities from 1990 to2020, this study uses the multiperiod difference-in-differences approach to examine howpaired assistance has contributed to economic growth in Xizang Autonomous Region andXinjiang Uygur Autonomous Region. The findings indicate that, first, the implementation ofthe paired assistance policy has boosted economic growth in Xizang and Xinjiang. Second,paired assistance has stimulated economic growth in recipient communities by improvinginfrastructure. Third, paired assistance has contributed to economic growth in recipientcommunities by providing improved public services such as education and healthcare.Improvements to public services have a relatively smaller indirect effect in short termthan infrastructure development on economic growth. Yet both education and healthcareare crucial to people’s quality of life in recipient communities. This paper has refined andbroadened research on the effects of paired assistance, providing preference for futurepolicymaking.

Keywords: Chinese characteristics, paired assistance, multiperiod difference-indifferences,

JEL Classification Codes: H53, I38, R58

DOI: 10.19602/j.chinaeconomist.2024.05.05