Does anti-poverty intervention strengthen mental resilience? Evidence from the COVID-19 shock on targeted poverty alleviation program in China

ABSTRACT

Resilience is beneficial for poor households to overcome the negative shocks and shake off the poverty trap completely in the long run. In this article we evaluate the impact of poverty alleviation intervention on mental resilience by exploiting the natural experiment of the COVID-19 shock. Using the survey data collected in early March 2020 from underdeveloped region in West China, we address the impact of targeted poverty alleviation program (TPAP) on confidence level of off-farm and total income recovery using the difference-in-difference method. We find that the program enhances mental resilience for the out of poverty households rather than the in poverty households, especially in terms of confidence level of off-farm income recovery. In addition, we also find that proactivity of employment takes account of the impact of TPAP on confidence level of off-farm income recovery.