Does the Supply of Public Goods Alleviate the Relative Poverty in Urban Areas?

After 2020, the Chinese government shifts its focus of poverty governance from absolute poverty to relative poverty and expands the region of poverty governance from rural areas to urban areas. Based on two datasets of China, a macro panel dataset at the provincial level and a micro dataset of CFPS, this paper constructs multiple econometric models to investigate how local public-goods supply influences urban relative poverty. The results indicate that the supply of public goods exacerbates urban relative poverty. On the one hand, the supply of soft public goods yoked to the household registration system aggravates urban relative poverty, as is more prominent in provinces with much higher- and lower-levels of economic development compared with the average. On the other hand, the capitalization of public-goods supply causes significant increases in housing prices, thus aggravating urban relative poverty. Decomposition of the urban relative poverty index indicates that public-goods supply aggravates urban relative poverty mainly through intensifying the depth (degree) rather than the breadth (incidence) of urban relative poverty. Further spatial analyses tell that although public-goods supply has an obvious spatial agglomeration effect, urban relative poverty follows a relatively random spatial distribution. Public-goods supply has a significantly positive spatial spillover effect on relative poverty, mainly embodied in population migration and improving public-goods supply levels of surrounding provinces