Population and Inequality in East Asia

This paper describes the inequality experience of East Asia beginning around 1960 and explores whether that experience is consistent with alternative theories about the determinants of income inequality. Particular emphasis is placed on the implications of rapid economic growth and rapid demographic change that characterized the region. Simple models do not capture the enormous complexity that is characteristic of the region. The differences and the trends in inequality reflect a variety of historical, cultural, political, and geographic forces that have influenced agricultural systems, economic structure, technological innovation, social heterogeneity and cohesion, and the distributions of land, human capital, and other forms of wealth. All of these factors have influenced the extent of inequality in the region. Among the important factors examined are the decline in child dependency, the rise in female labor force participation, demographically-induced changes in factor proportions and factor prices, and changes in health and life-expectancy. Although broad generalizations are difficult, modern societies with low fertility and mortality appear to be characterized by greater equality than traditional ones.