recipients. Thresholds for eligibility in 2022 varied from 1330/person per month in Shanghai (equivalent to USD 10/day in 2017 PPP) to 402/person per month in rural Guizhou (equivalent to USD3.7/day in 2017 PPP). The _Tekun_ assistance program is aimed at helping the elderly, the disabled, and those aged below 16 without any supporter nor source of income and who are unable to work. The Tekun beneficiaries receive basic living arrangements, tendance, medical treatment, and proper burial. In 2018, 5.28 million individuals benefited from the Tekun assistance program, with average annual benefits of 10,650 yuan for urban recipients and 6,745 yuan for rural recipients. The Dibao and Tekun programs are mutually exclusive so that an individual cannot be a beneficiary of both programs simultaneously. Dibao and Tekun are also considered as the entry to other social assistance programs, such as housing, medical and education supports. Once eligibility for these cash programs is established, a package of services is also provided, according to specific household composition and needs,

# Data and Methodology

## **Data**

We exploit several data sources, including a micro-level household survey dataset and aggregate-level statistics from administrative data. The main household survey data used is the 2018 China Family Panel Study (CFPS), which is a biennial longitudinal study with a 2010 baseline. This is a nationally representative survey that collects community, household, and individual sociodemographic characteristics of contemporary China. The estimated geographical distribution of the population using the CFPS is comparable to reports based on official data. For all estimations, we use CFPS individual weights to account for differences in the probability of selection of each group and ensure that the total weighted number of people matches with the population in the country, as reported by the National Bureau of Statistics.<sup>9</sup> The information collected is suitable for carrying out fiscal incidence analysis as it includes individual labor income, household agricultural and business operation income, household rental income, financial investment profits, private transfers, auto-consumption, household expenditure by category, coverage of social insurance programs, reception of cash transfers and pension, as well as utilization of education and health services. The 2014 round of the CFPS was used in a previous fiscal incidence analysis for China (Lustig and Wang 2018). For the current analysis, we use the 2018 round, which contains the most recent available survey data. The 2018 round has information on 45,310 individuals from 14,218 households in 31 provinces/municipalities/autonomous regions.<sup>10</sup> To model some of the interventions, we also rely on alternative surveys: the 2012 round of the CFPS and the 2019 China Household Finance Survey. Our second key source of information is administrative data. We use administrative data to validate the consistency of the survey-based estimates, as well as to conduct simulations and imputations when detailed information in the survey is not available. The main sources of administrative data are the Statistical Yearbook of China 2019, China Social Statistical Yearbook 2019, the 2019 Finance Yearbook of China, the 2018 Annual Report of Housing Fund, and 2018 Statistical Bulletin on Development of Human Resources and Social Security and information from the Ministry of Finance, the Ministry of Housing and UrbanRural Development, and The People's Bank of China.

> 9 CFPS-based estimates indicate that 54.1% of individuals are urban residents and 38.5% are rural residents, which is comparable to official reports showing a distribution of 59.6% individuals residing in urban areas and 40.4% in rural areas. Regarding province of residency, 44.2% individuals reside in the Coastal region, 31.4% in the Interior region and 23.9% in the Western region according to estimates using the CFPS. These shares are also comparable to the respective shares in official data of 45.2%, 33.1% and 21.9%.

> 10 Hong Kong SAR, Macao SAR, and Taiwan, China are not covered. For more details on the CFPS survey, visit: <u>https://www.isss.pku.edu.cn/cfps/en/index.htm.</u>

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