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Income Inequality in China's Economic and Technological Development Zones and High-Tech Industrial Development Zones, 1995–2002

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  • Octasiano M. Valerio Mendoza

    (Graduate School of International Development, Nagoya University, Furo-cho, Chikusa-ku, Nagoya 464-8601, Japan)

Abstract

This paper analyzes income inequality in China's Economic and Technological Development Zones (ETDZs) and High-Tech Industrial Development Zones (HIDZs). ETDZs and HIDZs are development zones located within cities that have preferential policies aimed at promoting technology and industry, and have served as instruments for attracting foreign direct investment, fomenting trade performance, stimulating scientific research, and upgrading specific industries in China. This paper uses the China Household Income Project Surveys for 1995 and 2002, which have an urban dataset covering over 6000 households and 20,000 individuals from up to 70 cities and 12 provinces. The spatial decomposition of inequality shows that cities with a zone, whether it is an ETDZ or HIDZ, have higher incomes and lower income inequality than cities without any zone. Furthermore, the gap in income inequality between cities with and without ETDZs seems to be converging, while the gap between cities with and without HIDZs is increasing because income inequality in cities with HIDZs has decreased. Lastly, while cities that have no zones have the lowest income and inequality measures, cities that have only one zone, ETDZ or HIDZ, have higher income and lower inequality measures than cities that have both an ETDZ and HIDZ.

Suggested Citation

  • Octasiano M. Valerio Mendoza, 2014. "Income Inequality in China's Economic and Technological Development Zones and High-Tech Industrial Development Zones, 1995–2002," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 3(02), pages 1-22.
    • Handle: RePEc:wsi:ceprxx:v:03:y:2014:i:02:n:s1793969014500125
    DOI: 10.1142/S1793969014500125
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    References listed on IDEAS

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    Cited by:

    1. Valerio Mendoza, Octasiano M., 2016. "Preferential policies and income inequality: Evidence from Special Economic Zones and Open Cities in China," China Economic Review, Elsevier, vol. 40(C), pages 228-240.

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    More about this item

    Keywords

    China; urban income inequality; preferential policies; special economic zones; spatial decomposition; O15; J1; D3; D63; H30; R12;
    All these keywords.

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • J1 - Labor and Demographic Economics - - Demographic Economics
    • D3 - Microeconomics - - Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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