[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/lvl/pmmacr/2007-07.html
   My bibliography  Save this paper

Inequality and Poverty in China during Reform

Author

Listed:
  • Sangui Wang
  • Dwayne Benjamin
  • Loren Brandt
  • John Giles
  • Yingxing Li
  • Yun Li
Abstract
This paper provides an overview of the evolution of income inequality and poverty in China from 1987 to 2002, documenting significant increases of inequality within China's urban and rural populations. In rural areas, increased inequality is primarily related to the disequalizing role of non-agricultural self-employment income and the slow growth in agricultural income from the mid-1990s onward. Poverty persists, and tied in part to slow growth in agricultural commodity prices. In urban areas, the declining role of subsidies and entitlements, the increase in wage inequality, and the layoffs during restructuring have fueled the growth in inequality within urban areas. Poverty levels, however, are very low. China should give more emphasis on education, training, and other human development efforts in its poverty reduction strategy since return to education increased rapidly and became a major source of inequality. A nationwide "social safety net" and an effective redistributive taxation system should be adopted and implemented to ensure that the poor can benefit from the fruits of rapid economic growth.

Suggested Citation

  • Sangui Wang & Dwayne Benjamin & Loren Brandt & John Giles & Yingxing Li & Yun Li, 2007. "Inequality and Poverty in China during Reform," Working Papers PMMA 2007-07, PEP-PMMA.
    • Handle: RePEc:lvl:pmmacr:2007-07
    as

    Download full text from publisher

    File URL: https://portal.pep-net.org/documents/download/id/13542
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Keith Griffin & Azizur Rahman Khan & Carl Riskin, 1999. "Income Distribution in Urban China during the Period of Economic Reform and Globalization," American Economic Review, American Economic Association, vol. 89(2), pages 296-300, May.
    2. Dwayne Benjamin & Loren Brandt & Paul Glewwe & Guo Li, 2002. "Markets, Human Capital and Inequality: Evidence from Rural China," International Economic Association Series, in: Richard B. Freeman (ed.), Inequality Around the World, chapter 5, pages 87-127, Palgrave Macmillan.
    3. Gustafsson, Bjorn & Li, Shi, 2004. "Expenditures on education and health care and poverty in rural China," China Economic Review, Elsevier, vol. 15(3), pages 292-301.
    4. Heckman, James J, 2003. "China's Investment in Human Capital," Economic Development and Cultural Change, University of Chicago Press, vol. 51(4), pages 795-804, July.
    5. Benjamin, Dwayne & Brandt, Loren & Giles, John, 2005. "The Evolution of Income Inequality in Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 53(4), pages 769-824, July.
    6. Rawski, Thomas G., 1982. "The Simple Arithmetic of Chinese Income Distribution," Economic Review, Hitotsubashi University, vol. 33(1), pages 12-26, January.
    7. Loren Brandt & Dwayne Benjamin, 1999. "Markets and Inequality in Rural China: Parallels with the Past," American Economic Review, American Economic Association, vol. 89(2), pages 292-295, May.
    8. Anthony F. Shorrocks, 1983. "The Impact of Income Components on the Distribution of Family Incomes," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(2), pages 311-326.
    9. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. World Bank, 2012. "Well Begun, Not Yet Done : Vietnam's Remarkable Progress on Poverty Reduction and the Emerging Challenges," World Bank Publications - Reports 12326, The World Bank Group.
    2. Wang, Xiaojun & Fleisher, Belton M. & Li, Haizheng & Li, Shi, 2014. "Access to college and heterogeneous returns to education in China," Economics of Education Review, Elsevier, vol. 42(C), pages 78-92.
    3. Almås, Ingvild & Johnsen, Åshild Auglænd, 2012. "The cost of living in China: Implications for inequality and poverty," Discussion Paper Series in Economics 21/2012, Norwegian School of Economics, Department of Economics.
    4. Zhixin Zeng & Xiaojun Wang, 2021. "Effects of Domestic Tourism on Urban-Rural Income Inequality: Evidence from China," Sustainability, MDPI, vol. 13(16), pages 1-21, August.
    5. Shijun Ding & Laura Meriluoto & W. Robert Reed & Daoyun Tao & Haitao Wu, 2010. "The Impact of Agricultural Technology Adoption of Income Inequality in Rural China," Working Papers in Economics 10/41, University of Canterbury, Department of Economics and Finance.
    6. Valerie Kozel, 2014. "Well Begun but Not Yet Done : Progress and Emerging Challenges for Poverty Reduction in Vietnam," World Bank Publications - Books, The World Bank Group, number 20074.
    7. Ingvild Almas & Ashild Johnsen, 2018. "The cost of a growth miracle - reassessing price and poverty trends in China," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 30, pages 239-264, October.
    8. Zhai, Fan & Hertel, Thomas W., 2009. "Economic and Poverty Impacts of Agricultural, Trade and Factor Market Reforms in China," Agricultural Distortions Working Paper Series 52787, World Bank.
    9. Adams, Samuel & Klobodu, Edem Kwame Mensah, 2017. "Capital flows and the distribution of income in sub-Saharan Africa," Economic Analysis and Policy, Elsevier, vol. 55(C), pages 169-178.
    10. Fu, Rao & Jin, Gui & Chen, Jinyue & Ye, Yuyao, 2021. "The effects of poverty alleviation investment on carbon emissions in China based on the multiregional input–output model," Technological Forecasting and Social Change, Elsevier, vol. 162(C).
    11. Thomas Gries & Manfred Kraft & Manuel Simon, 2016. "Explaining inter-provincial migration in China," Papers in Regional Science, Wiley Blackwell, vol. 95(4), pages 709-731, November.
    12. Wang, Xiaojun & Fleisher, Belton M. & Li, Haizheng & Li, Shi, 2007. "Access to Higher Education and Inequality: The Chinese Experiment," IZA Discussion Papers 2823, Institute of Labor Economics (IZA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dwayne Benjamin & Loren Brandt & John Giles & Sangui Wang, 2005. "Income Inequality During China's Economic Transition," Working Papers tecipa-238, University of Toronto, Department of Economics.
    2. Chen, Xi & Zhang, Xiaobo, 2009. "The Distribution of Income and Well-Being in Rural China: A Survey of Panel Data Sets, Studies and New Directions," MPRA Paper 20587, University Library of Munich, Germany.
    3. Benjamin, Dwayne & Brandt, Loren & Giles, John, 2005. "The Evolution of Income Inequality in Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 53(4), pages 769-824, July.
    4. Li, Yan & DaCosta, Maria N., 2013. "Transportation and income inequality in China: 1978–2007," Transportation Research Part A: Policy and Practice, Elsevier, vol. 55(C), pages 56-71.
    5. Glauben, Thomas & Herzfeld, Thomas & Rozelle, Scott & Wang, Xiaobing, 2012. "Persistent Poverty in Rural China: Where, Why, and How to Escape?," World Development, Elsevier, vol. 40(4), pages 784-795.
    6. Katsushi S. Imai & Jing You, 2011. "Poverty Dynamics of Households in Rural China: Identifying Multiple Pathways for Poverty Transition," Discussion Paper Series DP2011-35, Research Institute for Economics & Business Administration, Kobe University.
    7. Khor, Niny & Pencavel, John, 2008. "Measuring Income Mobility, Income Inequality, and Social Welfare for Households of the People’s Republic of China," ADB Economics Working Paper Series 145, Asian Development Bank.
    8. Dwayne Benjamin & Loren Brandt, 2002. "Agriculture and Income Distribution in Rural Vietnam under Economic Reforms: A Tale of Two Regions," Working Papers benjamin-02-01, University of Toronto, Department of Economics.
    9. Qu, Zhaopeng (Frank) & Zhao, Zhong, 2008. "Urban-Rural Consumption Inequality in China from 1988 to 2002: Evidence from Quantile Regression Decomposition," IZA Discussion Papers 3659, Institute of Labor Economics (IZA).
    10. Duclos, Jean-Yves & Araar, Abdelkrim & Giles, John, 2010. "Chronic and transient poverty: Measurement and estimation, with evidence from China," Journal of Development Economics, Elsevier, vol. 91(2), pages 266-277, March.
    11. Broich, T. & Szirmai, A., 2014. "China's economic embrace of Africa: An international comparative perspective," MERIT Working Papers 2014-049, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    12. Dwayne Benjamin & Loren Brandt & Paul Glewwe & Guo Li, 2002. "Markets, Human Capital and Inequality: Evidence from Rural China," International Economic Association Series, in: Richard B. Freeman (ed.), Inequality Around the World, chapter 5, pages 87-127, Palgrave Macmillan.
    13. Emran,M. Shahe & Sun,Yan - GSP05, 2015. "Are the children of uneducated farmers doubly disadvantaged ? farm, nonfarm and intergenerational educational mobility in rural China," Policy Research Working Paper Series 7459, The World Bank.
    14. WANG, Zuxiang & SMYTH, Russell & NG, Yew-Kwang, 2009. "A new ordered family of Lorenz curves with an application to measuring income inequality and poverty in rural China," China Economic Review, Elsevier, vol. 20(2), pages 218-235, June.
    15. Loren Brandt & Debin Ma & Thomas G. Rawski, 2014. "From Divergence to Convergence: Reevaluating the History behind China's Economic Boom," Journal of Economic Literature, American Economic Association, vol. 52(1), pages 45-123, March.
    16. Gustafsson, Björn Anders & Yue, Ximing, 2006. "Rural People’s Perception of Poverty in China," IZA Discussion Papers 2486, Institute of Labor Economics (IZA).
    17. Ning, Guangjie, 2010. "Can educational expansion improve income inequality? Evidences from the CHNS 1997 and 2006 data," Economic Systems, Elsevier, vol. 34(4), pages 397-412, December.
    18. Almås, Ingvild & Johnsen, Åshild Auglænd, 2012. "The cost of living in China: Implications for inequality and poverty," Discussion Paper Series in Economics 21/2012, Norwegian School of Economics, Department of Economics.
    19. C�line Bonnefond & Matthieu Cl�ment, 2012. "An analysis of income polarisation in rural and urban China," Post-Communist Economies, Taylor & Francis Journals, vol. 24(1), pages 15-37, June.
    20. XING, Li & FAN, Shenggen & LUO, Xiaopeng & ZHang, Xiaobo, 2009. "Community poverty and inequality in western China: A tale of three villages in Guizhou Province," China Economic Review, Elsevier, vol. 20(2), pages 338-349, June.

    More about this item

    Keywords

    Income inequality; poverty; welfare; growth; reform; transition; policy; China;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lvl:pmmacr:2007-07. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Manuel Paradis (email available below). General contact details of provider: https://edirc.repec.org/data/cdvlvca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.