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Proposes a method for testing whether transient and chronic poverty share common determinants using household data from rural China for the period 1985-90. Measurement of transient and chronic poverty; Estimation models of transient and chronic poverty; Conclusions.

Research indicates remarkable geographic differences in levels of living within China. The geographic pattern of economic growth in post-reform China has been the subject of a number of recent papers. The geographic mobility of labor has historically been restricted in China, and clearly this has not helped China's rural poor. Since the mid-1980s, antipoverty policies in China have emphasized poor-area development. Poor-area programs make sense in China, given that where one lives constrains prospects of escaping poverty, including by out-migration. However, such programs alone are unlikely to solve China's poverty problem. A comprehensive strategy for doing so will also help protect poor people from the risks they face and should not neglect poor people in nonpoor areas.