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Income inequality and mobility of rural households in China from 2003 to 2006

Author

Listed:
  • Wenkai Sun
  • Xianghong Wang
  • Chong-En Bai

Abstract

Purpose - – This paper aims to illustrate the trends of income growth and income inequality and examines the dynamics and determinants of income mobility in rural China from 2003 to 2006. Design/methodology/approach - – The authors decomposed the Gini coefficient by different sources and analyzed income mobility using the method of income transition matrix. The authors then estimated the effects of demographic variables, labor migration, and other household characteristics on income growth using a dynamic panel data model. Findings - – The study obtained important findings on income mobility and income inequality in rural China. First, annual income inequality in rural China was smoothed during this period after a decline from 2003, with the largest contribution from the income of migration work. Second, income mobility remained rather stable and relatively high, with higher mobility in the interior provinces than in the coastal provinces. Third, the income levels of the poor and the wealthy households converged during this period after controlling other factors. Fourth, income growth depends on in the households' demographic composition, their human capital accumulation, and their chances of getting migration jobs. Originality/value - – The sound econometric methods applied to the most current rural household survey data provide important contributions to the literature of income inequality and income mobility in China.

Suggested Citation

  • Wenkai Sun & Xianghong Wang & Chong-En Bai, 2014. "Income inequality and mobility of rural households in China from 2003 to 2006," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 6(1), pages 73-91, January.
    • Handle: RePEc:eme:caerpp:v:6:y:2014:i:1:p:73-91
    DOI: 10.1108/CAER-12-2011-0161
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    Citations

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    Cited by:

    1. Xinjie Shi, 2022. "Moving out but not for the better: Health consequences of interprovincial rural‐urban migration in China," Health Economics, John Wiley & Sons, Ltd., vol. 31(4), pages 555-573, April.
    2. Yang Song & Wenkai Sun, 2016. "Health Consequences of Rural‐to‐Urban Migration: Evidence from Panel Data in China," Health Economics, John Wiley & Sons, Ltd., vol. 25(10), pages 1252-1267, October.
    3. Li, Baoxi & Cheng, Shixiong & Xiao, De, 2020. "The impacts of environmental pollution and brain drain on income inequality," China Economic Review, Elsevier, vol. 62(C).
    4. Wu, Bangzheng & Yue, Pengpeng & Zuo, Shengqiang, 2023. "Borrow to be the poor or the rich? It depends: Credit market and wealth accumulation," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 804-821.
    5. Tao Xu, 2022. "Rural Pension System and Farmers' Participation in Residents' Social Insurance," Papers 2204.00785, arXiv.org.
    6. Fields, Gary S. & Meng, Xin & Song, Yang, 2022. "Earnings mobility during labor market reforms in urban China," China Economic Review, Elsevier, vol. 75(C).
    7. Xu, Tao, 2021. "Rural Pension System and Farmers' Participation in Residents' Social Insurance," MPRA Paper 112032, University Library of Munich, Germany, revised 18 Feb 2022.
    8. Ming Guan, 2016. "Income diversification of Chinese rural households after they rent out land," Cogent Business & Management, Taylor & Francis Journals, vol. 3(1), pages 1265803-126, December.
    9. Qian Guo & Wenkai Sun & Yijie Wang, 2017. "Effect of Parental Migration on Children's Health in Rural China," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 1132-1157, November.

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