The Dual Welfare Structure

Abstract

This chapter discusses the relationship between rural welfare and dual social-economic structure. Rural welfare system set up under a dual structure. The welfare system was the totally different between urban and rural areas. The urban welfare system was institutionalized and supported urban residents from the “cradle to grave”, while the rural system was residual (based collective welfare) and peasants received very little cash assistance. This system was supported by three key policies, the hukou (household registration system), the tonggou tongxiao zhengce (the policy of state monopoly for trading grain, cotton, and oil), and the shangpinliang gongyingzhi (the system of commercial food provision). The state prioritized support for the urban industrial workers for accumulation of industrialization in a situation of a huge population and limited resources. The contribution of peasants is establishment of a modern industrial foundation.