Soaring Income Gaps: China in Comparative Perspective

Daedalus

Volumn 143, Issue 2, 2014, Pages 39-52

  Whyte, Martin King ^a  

^a HARVARD UNIVERSITY   (United States)

Author keywords

[No Author keywords available]

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EID: 84896934942     PISSN: 00115266     EISSN: 15486192     Source Type: Journal    
DOI: 10.1162/DAED_a_00271     Document Type: Article

References (33)

1. However, income inequalities in China today are not the result of the rich getting rich and the poor getting poorer. China's booming economy for more than three decades has brought improved living standards to the overwhelming majority of Chinese, and the proportion living below the internationally recognized poverty line ($1.25 per day, per person in constant dollars) has fallen from something like 60 percent at the end of the Mao era to under 10 percent today. But the incomes of China's poor have not increased as rapidly as the incomes of the rich. 2 On the Wen Jiabao family fortune
2. David Barboza, Billions in Hidden Riches for Family of Chinese Leader, The New York Times, October 25, 2012. On the Xi Jinping family financial empire
3. Xi Jinping Millionaire Relations Reveal Hidden Fortunes of Elite, Bloomberg News, June 29, 2012. On the connections and wealth of the children and grandchildren of the ccp's founding eight immortal leaders
4. Heirs of Mao's Comrades Rise as New Capitalist Nobility, Bloomberg News, December 26, 2012.
5. Chris Buckley, China Issues Proposal to Narrow Income Gap, The New York Times, February 5, 2013.
6. The highest quality income surveys for China were conducted in 1988, 1995, 2002, and 2007 by an international collaborative team, the China Household Income Project Surveys (chips). The renewed increases in income inequality that those surveys documented are discussed in detail in Li Shi, Hiroshi Sato, and Terry Sicular, eds., Rising Inequality in China: Challenges to a Harmonious Society (New York: Cambridge University Press, 2013).
7. In the same time period in other populous Asian societies, such as India, Pakistan, Bangladesh, and Indonesia (as well as post-socialist Vietnam), Gini estimates (reported in the same data sources) generally have been in the 0.30 to 0.39 range, and without the sharp rise visible for China
8. http://www.china.com.cn/zhibo/2013-01/18/content_27692231.htm?show=t. Specifically, the Gini figures given by Ma were as follows: 2003, 0.479; 2004, 0.473; 2005, 0.485; 2006, 0.487; 2007, 0.484; 2008, 0.491; 2009, 0.490; 2010, 0.481; 2011, 0.477; 2012, 0.474. He attributed the modest improvement in income distribution largely to rural incomes rising more rapidly than urban incomes in the period since 2007.
9. Roberto Korzeniewicz and Timothy Moran, Theorizing the Relationship between Inequality and Economic Growth, Theory and Society 34 (3) (June 2005): 277-316.
10. The study by Simon Kuznets that they debunk is Economic Growth and Income Inequality, American Economic Review 45 (1) (March 1955): 1-28.
11. Obviously, more recent trends in highly industrialized countries depart from the Kuznets scenario as well. The return to rising levels of income inequality in advanced countries since the 1970s has produced trends over time that might better be described as a supine S.
12. United Nations, Growth with Equity: Policy Lessons from Selected Asian Countries (New York: United Nations, 1999)
13. Wang Feng, The End of 'Growth with Equity'? Economic Growth and Income Inequality in East Asia, AsiaPacific Issues no. 101 (July 2011): 1-8
14. Eunju Chi and Hyeok Yong Kwon, Unequal New Democracies in East Asia: Rising Inequality and Government Responses in South Korea and Taiwan, Asian Survey 52 (5) (October 2012): 900-923.
15. See the discussion in Ivan Szelenyi, Urban Inequalities under State Socialism (New York: Oxford University Press, 1983)
16. Martin King Whyte, Myth of the Social Volcano: Perceptions of Inequality and Distributive Injustice in Contemporary China (Stanford, Calif.: Stanford University Press, 2010).
17. Branko Milanovic and Lire Ersado, Reform and Inequality during the Transition: An Analysis Using Panel Household Survey Data, 1990-2005, United Nations University-World Institute for Development Economics Research Working Paper No. 2010/62 (May 2010).
18. Nationwide land reform programs in the late 1940s and 1950s also made an important contribution to growth with equity in these countries.
19. One difference is that Chinese socialism had eliminated private businesses familiar with operating in overseas markets, so that after 1978 China had to rely much more on foreign direct investment and Hong Kong commercial expertise in order to develop its export manufacturing sector.
20. Audrey Donnithorne, China's Cellular Economy: Some Economic Trends since the Cultural Revolution, The China Quarterly 52 (October 1972): 605-619.
21. Nicholas Lardy, Economic Growth and Distribution in China (New York: Cambridge University Press, 1978).
22. John G. Gurley, Capitalist and Maoist Economic Development, Bulletin of Concerned Asian Scholars 2 (3) (April-July 1970): 34-50.
23. Kam Wing Chan, Cities with Invisible Walls (New York: Oxford University Press, 1994);
24. Fei-ling Wang, Organizing through Division and Exclusion: China's Hukou System (Stanford, Calif.: Stanford University Press, 2005)
25. Martin King Whyte, ed., One Country, Two Societies: Rural-Urban Inequality in Contemporary China (Cambridge, Mass.: Harvard University Press, 2010).
26. To give one simple example, in the late-Mao era, unlike in other societies (including the ussr), farmers were forbidden to bring produce or handicrafts into cities to sell to urban consumers.
27. See the discussion in Wang Feng, Boundaries and Categories: Rising Inequality in Post-Socialist Urban China (Stanford, Calif.: Stanford University Press, 2008).
28. In the last decade or so, migrant wages have begun to increase, after remaining relatively stagnant during the 1980s and 1990s. However, migrants still are disadvantaged compared to comparable laborers with urban hukou not only in wages, but also in access to most other benefits and services. Li, Sato, and Sicular, Rising Inequality in China, 32.
29. There is a comprehensive discussion of multiple harmonious society programs in ibid., chap. 1. According to national surveys the author directed in China, the rural coverage rate by public medical insurance increased from only 15.4 percent in 2004 to 89.6 percent in 2009.
30. See the discussion of the increasing role of wealth, particularly in the form of housing assets, between 2002 and 2007, as well as the homeowner statistics, in ibid., chap. 3. One observer contends that the result of China's urban housing privatization and subsequent price increases is arguably the largest accumulation of real estate wealth in history, worth over US $17 trillion in 2010. Leta Hong Fincher, Women's Rights at Risk, Dissent 60 (2) (Spring 2010): 37. In contrast to China, in 2007 only about 65 percent of American urbanites were homeowners.
31. Villagers generally live in privately owned ancestral housing, and when they build new housing they pay for it themselves, with no subsidized mortgages. Migrants usually live in factory dormitories or have to rent, often from suburban villagers.
32. China's 211 Project, initiated in 1995, aimed to identify one hundred universities with the potential of becoming world class and initially invested 11 billion yuan in their development; the 985 Project, launched in 1998, focused on a smaller set of elite universities (eventually thirty-nine) and invested more than 12 billion yuan in them in the first two years; and the 111 Project, launched in 2006, aimed to bring large numbers of foreign scientists to China to enhance the research capabilities of the same elite universities favored by the 985 Project. For the regressive impact across provinces of these reforms on university funding and enrollments. Hannah Waight, Ordered Inequality: The Role of Reform in Structuring Disparities in Chinese Higher Education, Sociology 237 seminar paper, Harvard University, December 2012. For the role of university enrollment expansion in widening the rural-urban disparity in college access, see Maocan Guo, School Expansion and Education
33. IStratification in China, 1981-2006, Sociology Doctoral Program qualifying paper, Harvard University, 2009.