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Working for Less: Income Inequality and the Diminishing Share of Labor in China’s National Wealth

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  • Songtao Wang
  • Tristan Kenderdine
  • Zhen Qi

Abstract

This paper demystifies variation in labor’s share of national labor income in China from the perspective of the income gap. We extend the gross national labor income function by introducing a Gini coefficient to support our argument that the share of gross national labor income decreases with an increasing Gini coefficient. The hypotheses are tested using provincial data from 1996 to 2010- (1) the Gini coefficient’s ‘inverted U’ shape partially contributes to the U-shaped evolution of the labor income-share; (2) China’s 15 per cent decline in the labor income share can be explained by the widening income gap during that time.Â

Suggested Citation

  • Songtao Wang & Tristan Kenderdine & Zhen Qi, 2017. "Working for Less: Income Inequality and the Diminishing Share of Labor in China’s National Wealth," Asian Social Science, Canadian Center of Science and Education, vol. 13(6), pages 1-81, June.
    • Handle: RePEc:ibn:assjnl:v:13:y:2017:i:6:p:81
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    Cited by:

    1. Marinko Skare & Luis A. Gil-Alana & Gloria Claudio-Quiroga & Romina Pržiklas Družeta, 2021. "Income inequality in China 1952–2017: persistence and main determinants," Oeconomia Copernicana, Institute of Economic Research, vol. 12(4), pages 863-888, December.

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    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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