Public assistance in urban and rural China: A tale of two stories

China's public assistance system has been urban–rural divided ever since its implementation in the 1990s. Despite the intention in recent years to promote an integrated public assistance system, there has been little empirical research that has systematically examined the differences between urban and rural areas. Moreover, research has focused mostly on the Minimum Living Assurance system (“Dibao”), paying little attention to other types of public assistance. This study contributes to filling this gap by analyzing a recent data set collected primarily from two Chinese provinces. The findings show substantial differences in the amount of public assistance received by urban and rural low‐income households, even after controlling for demographic and socioeconomic factors. Compared with urban recipient households, rural recipient households have disproportionally lower public assistance benefits and higher medical costs relative to their household expenditure, which suggests that assistance inadequacy is especially prominent among rural households. Policy implications are discussed.