IDEAS home Printed from https://ideas.repec.org/p/unu/wpaper/wp-2018-174.html
   My bibliography  Save this paper

Inequality in China: Development, transition, and policy

Author

Listed:
  • Shi Li
  • Terry Sicular
  • Finn Tarp

Abstract

In this paper we describe the major trends in China's income inequality over the past 40 years and explain them as the outcome of four interleaved stories. The first story is a standard development story characterized by structural change, market development, labour absorption, and the Kuznets inverted-U path of inequality. The second is the economic transition story, in which changes in income distribution result from the shift from plan to market. Third is incomplete transition, with opportunities for rent-seeking, corruption, and hidden income.

Suggested Citation

  • Shi Li & Terry Sicular & Finn Tarp, 2018. "Inequality in China: Development, transition, and policy," WIDER Working Paper Series wp-2018-174, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2018-174
    as

    Download full text from publisher

    File URL: https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2018-174.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Démurger, Sylvie & Gurgand, Marc & Li, Shi & Yue, Ximing, 2009. "Migrants as second-class workers in urban China? A decomposition analysis," Journal of Comparative Economics, Elsevier, vol. 37(4), pages 610-628, December.
    2. Carl Lin & Myeong-Su Yun, 2016. "The Effects of the Minimum Wage on Earnings Inequality: Evidence from China," Research in Labor Economics, in: Income Inequality Around the World, volume 44, pages 179-212, Emerald Group Publishing Limited.
    3. Knight, John & Deng, Quheng & Li, Shi, 2011. "The puzzle of migrant labour shortage and rural labour surplus in China," China Economic Review, Elsevier, vol. 22(4), pages 585-600.
    4. Liu, Hong & Zhao, Zhong, 2014. "Does health insurance matter? Evidence from China’s urban resident basic medical insurance," Journal of Comparative Economics, Elsevier, vol. 42(4), pages 1007-1020.
    5. Bjorn Gustafsson & Sai Ding, 2017. "Unequal Growth: Unequal Growth: How Household Incomes and Poverty in Urban China Have Developed since 1988, with an Emphasis on the Period from 2007 to 2013," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 201718, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    6. Quheng Deng & Shi Li, 2009. "What Lies behind Rising Earnings Inequality in Urban China? Regression-based Decompositions," CESifo Economic Studies, CESifo Group, vol. 55(3-4), pages 598-623.
    7. Jinjun Xue & Chuliang Luo & Shi Li, 2014. "Globalization, Liberalization And Income Inequality: The Case Of China," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 59(01), pages 1-21.
    8. Xinxin Ma & Shi Li, 2017. "The Effects of Minimum Wage on Wage Distribution in Urban China: Evidence from the CHIP Data," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 201724, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    9. Hisatoshi Hoken & Hiroshi Sato, 2017. "Public Policy and Long-Term Trends in Inequality in Rural China, 1988-2013," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 201716, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    10. Shi Li & Xinxin Ma, 2015. "Impact of minimum wage on gender wage gaps in urban China," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-22, December.
    11. Zhang, Junsen & Zhao, Yaohui & Park, Albert & Song, Xiaoqing, 2005. "Economic returns to schooling in urban China, 1988 to 2001," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 730-752, December.
    12. Golan, Jennifer & Sicular, Terry & Umapathi, Nithin, 2017. "Unconditional Cash Transfers in China: Who Benefits from the Rural Minimum Living Standard Guarantee (Dibao) Program?," World Development, Elsevier, vol. 93(C), pages 316-336.
    13. Zan Yang & Jie Chen, 2014. "Housing Affordability and Housing Policy in Urban China," SpringerBriefs in Economics, Springer, edition 127, number 978-3-642-54044-8, June.
    14. Xin Meng, 2004. "Economic Restructuring and Income Inequality in Urban China," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 50(3), pages 357-379, September.
    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. Roy van der Weide & Ambar Narayan, 2019. "China and the United States: Different economic models but similarly low levels of socioeconomic mobility," WIDER Working Paper Series wp-2019-121, World Institute for Development Economic Research (UNU-WIDER).

    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. Shi Li & Terry Sicular & Finn Tarp, 2018. "Inequality in China: Development, transition, and policy," WIDER Working Paper Series 174, World Institute for Development Economic Research (UNU-WIDER).
    2. Björn Gustafsson & Haiyuan Wan, 2018. "Wage growth and inequality in urban China: 1988–2013," WIDER Working Paper Series 163, World Institute for Development Economic Research (UNU-WIDER).
    3. Björn Gustafsson & Haiyuan Wan, 2018. "Wage growth and inequality in urban China: 1988-2013," WIDER Working Paper Series wp-2018-163, World Institute for Development Economic Research (UNU-WIDER).
    4. Terry Sicular & Shi Li & Ximing Yue & Hiroshi Sato, 2017. "Changing Trends in China’s Inequality: Key Issues and Main Findings," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 201712, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    5. Ren, Yanjun & Peng, Yanling & Campos, Bente Castro & Li, Houjian, 2021. "Higher minimum wage, better labour market returns for rural migrants? Evidence from China," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 34(1), pages 1814-1835.
    6. repec:wyi:journl:002165 is not listed on IDEAS
    7. Meng, Xin & Shen, Kailing & Xue, Sen, 2013. "Economic reform, education expansion, and earnings inequality for urban males in China, 1988–2009," Journal of Comparative Economics, Elsevier, vol. 41(1), pages 227-244.
    8. Ge, Suqin & Yang, Dennis Tao, 2011. "Labor market developments in China: A neoclassical view," China Economic Review, Elsevier, vol. 22(4), pages 611-625.
    9. Juzhong Zhuang & Shi Li, 2016. "Understanding the Recent Trend of Income Inequality in China," Working Papers 196, Department of Economics, SOAS University of London, UK.
    10. Xin Meng & Chris Manning & Li Shi & Tadjuddin Nur Effendi (ed.), 2010. "The Great Migration," Books, Edward Elgar Publishing, number 13619.
    11. Golley, Jane & Meng, Xin, 2011. "Has China run out of surplus labour?," China Economic Review, Elsevier, vol. 22(4), pages 555-572.
    12. Honge Gong & Andrew Leigh & Xin Meng, 2012. "Intergenerational Income Mobility In Urban China," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 58(3), pages 481-503, September.
    13. Nie, Haifeng & Xing, Chunbing, 2019. "Education expansion, assortative marriage, and income inequality in China," China Economic Review, Elsevier, vol. 55(C), pages 37-51.
    14. Bjorn Gustafsson & Sai Ding, 2011. "Unemployment and the Rising Number of Non-Workers in Urban China: Causes and Distributional Consequences," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 201117, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    15. 岩﨑, 一郎 & Iwasaki, Ichiro & 馬, 欣欣 & Ma, Xin Xin, 2019. "現代中国における男女賃金格差: メタ分析による接近," Discussion Paper Series 689, Institute of Economic Research, Hitotsubashi University.
    16. Xing, Chunbing, 2016. "Human Capital and Urbanization in the People’s Republic of China," ADBI Working Papers 603, Asian Development Bank Institute.
    17. Zhao Chen & Ming Lu & Guanghua Wan, 2010. "Inter-Industry Wage Differentials: An Increasingly Important Contributor to Urban China Income Inequality," Global COE Hi-Stat Discussion Paper Series gd09-130, Institute of Economic Research, Hitotsubashi University.
    18. Björn Gustafsson & Ding Sai, 2020. "Growing into Relative Income Poverty: Urban China, 1988–2013," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 147(1), pages 73-94, January.
    19. Gordon Anderson & Tongtong Hao & Maria Grazia Pittau, 2019. "More unequal yet more alike, the changing patterns of family formation, generational mobility and household income inequality in China: a counter-factual analysis," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 17(3), pages 359-378, September.
    20. Qu, Zhaopeng & Zhao, Zhong, 2017. "Glass ceiling effect in urban China: Wage inequality of rural-urban migrants during 2002–2007," China Economic Review, Elsevier, vol. 42(C), pages 118-144.
    21. Haoming Liu, 2011. "Economic Reforms and Gender Inequality in Urban China," Economic Development and Cultural Change, University of Chicago Press, vol. 59(4), pages 839-876.

    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:unu:wpaper:wp-2018-174. 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: Siméon Rapin (email available below). General contact details of provider: https://edirc.repec.org/data/widerfi.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.