Based on a large-scale household survey conducted in 2007, this article reports on
poverty concentration and determinants in China’s low-income neighbourhoods and
social groups. Three types of neighbourhood are recognized: dilapidated inner-city
neighbourhoods, declining workers’ villages and urban villages. Respondents are
grouped into four categories: working, laid-off/unemployed and retired urban residents,
together with rural migrants. We first measure poverty concentration across different
types of neighbourhood and different groups. The highest concentrations are found in
dilapidated inner-city neighbourhoods and among the laid-off/unemployed. Mismatches
are found between actual hardships, sense of deprivation and distribution of social
welfare provision. Second, we examine poverty determinants. Variations in institutional
protection and market remuneration are becoming equally important in predicting
poverty generation, but are differently associated with it in the different neighbourhoods
and groups. As China’s urban economy is increasingly shaped by markets, the
mechanism of market remuneration is becoming a more important determinant of
poverty patterns, especially for people who are excluded from state institutions, notably
laid-off workers and rural migrants.