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Dynamics of Income Distribution across Chinese Provinces during 1978-98

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  • Hong Li

Abstract

This study attempts to examine the growth pattern of China's economy during 1978-98 from the perspective of income distribution dynamics. Motivated by the model of dynamic distribution, a transition matrix is derived from a panel of ratios of provincial real incomes to national averages across 30 provinces over 1978-98. The transition matrix is used not only to reveal the transitions of provinces between the states of income over time, but also to predict whether there is a tendency across provinces to converge in real income per worker in the long run. This study finds evidence of a slight reduction of income dispersion across Chinese provinces over 1978-98. However, the slight reduction of income dispersion is not strong enough for the provinces to converge to mean income. But there is a strong tendency to converge across provinces within regions and it is evident that, in the eastern region, poor provinces caught up with rich ones over the period under study. The long-run distribution indicates that there will not be a tendency to converge in real GDP per capita across provinces in the long run.

Suggested Citation

  • Hong Li, 2003. "Dynamics of Income Distribution across Chinese Provinces during 1978-98," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 1(2), pages 145-157.
    • Handle: RePEc:taf:jocebs:v:1:y:2003:i:2:p:145-157
    DOI: 10.1080/1476528032000066703C
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    References listed on IDEAS

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    Cited by:

    1. Peng Bin, 2016. "Dynamic Development of Regional Disparity in Mainland China: An Experimental Study Based on a Multidimensional Index," Sustainability, MDPI, vol. 8(12), pages 1-28, December.
    2. Cheong, Tsun Se & Wu, Yanrui, 2013. "Regional disparity, transitional dynamics and convergence in China," Journal of Asian Economics, Elsevier, vol. 29(C), pages 1-14.
    3. Cheong, Tsun Se & Wu, Yanrui, 2018. "Convergence and transitional dynamics of China's industrial output: A county-level study using a new framework of distribution dynamics analysis," China Economic Review, Elsevier, vol. 48(C), pages 125-138.
    4. Chun-Yu Ho & Dan Li, 2009. "The nexus of income and size distribution of Chinese cities, 1984-2003," Applied Economics Letters, Taylor & Francis Journals, vol. 16(17), pages 1677-1682.
    5. Bin, Peng, 2015. "Regional Disparity and Dynamic Development of China: a Multidimensional Index," MPRA Paper 61849, University Library of Munich, Germany.

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