IDEAS home Printed from https://ideas.repec.org/a/eee/chieco/v30y2014icp383-396.html
   My bibliography  Save this article

Income distribution in urban China: An overlooked data inconsistency issue

Author

Listed:
  • Jin, Hailong
  • Qian, Hang
  • Wang, Tong
  • Choi, E. Kwan

Abstract

The Urban Household Income and Expenditure Surveys, conducted by the National Bureau of Statistics, are extensively explored in income distribution studies. However, we find that a survey coverage expansion that includes migrant residents in the urban sample may induce serious data inconsistency before and after the year 2002. To further unveil the inconsistency, we construct a random walk hierarchical beta-2 distribution model, estimated by the unscented Kalman filter, to investigate the magnitude of the structural break. Results show that the gaps of Gini coefficients and the shape of the distribution can be bridged by a counterfactual time series that coherently measures the urban China income distribution.

Suggested Citation

  • Jin, Hailong & Qian, Hang & Wang, Tong & Choi, E. Kwan, 2014. "Income distribution in urban China: An overlooked data inconsistency issue," China Economic Review, Elsevier, vol. 30(C), pages 383-396.
    • Handle: RePEc:eee:chieco:v:30:y:2014:i:c:p:383-396
    DOI: 10.1016/j.chieco.2014.02.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1043951X14000182
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.chieco.2014.02.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ximing Wu & Jeffrey M. Perloff, 2005. "China's Income Distribution, 1985-2001," The Review of Economics and Statistics, MIT Press, vol. 87(4), pages 763-775, November.
    2. Duangkamon Chotikapanich & D. S. Prasada Rao & Kam Ki Tang, 2007. "Estimating Income Inequality In China Using Grouped Data And The Generalized Beta Distribution," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(1), pages 127-147, March.
    3. Hongbin Cai & Yuyu Chen & Li-An Zhou, 2010. "Income and Consumption Inequality in Urban China: 1992-2003," Economic Development and Cultural Change, University of Chicago Press, vol. 58(3), pages 385-413, April.
    4. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    5. Chotikapanich, Duangkamon & Griffiths, William E. & Rao, D. S. Prasada, 2007. "Estimating and Combining National Income Distributions Using Limited Data," Journal of Business & Economic Statistics, American Statistical Association, vol. 25, pages 97-109, January.
    6. Durbin, James & Koopman, Siem Jan, 2012. "Time Series Analysis by State Space Methods," OUP Catalogue, Oxford University Press, edition 2, number 9780199641178, December.
    7. Han, Jun & Liu, Runjuan & Zhang, Junsen, 2012. "Globalization and wage inequality: Evidence from urban China," Journal of International Economics, Elsevier, vol. 87(2), pages 288-297.
    8. Kanbur, Ravi & Zhang, Xiaobo, 1999. "Which Regional Inequality? The Evolution of Rural-Urban and Inland-Coastal Inequality in China from 1983 to 1995," Journal of Comparative Economics, Elsevier, vol. 27(4), pages 686-701, December.
    9. John Knight & Li Shi, 2006. "Three Poverties in Urban China," Review of Development Economics, Wiley Blackwell, vol. 10(3), pages 367-387, August.
    10. Huang,Yasheng, 2008. "Capitalism with Chinese Characteristics," Cambridge Books, Cambridge University Press, number 9780521898102, October.
    11. Chi, Wei, 2012. "Capital income and income inequality: Evidence from urban China," Journal of Comparative Economics, Elsevier, vol. 40(2), pages 228-239.
    12. Keith Griffin & Azizur Rahman Khan & Carl Riskin, 1999. "Income Distribution in Urban China during the Period of Economic Reform and Globalization," American Economic Review, American Economic Association, vol. 89(2), pages 296-300, May.
    13. Wu, Ximing & Perloff, Jeffrey M., 2007. "GMM estimation of a maximum entropy distribution with interval data," Journal of Econometrics, Elsevier, vol. 138(2), pages 532-546, June.
    14. McDonald, James B & Ransom, Michael R, 1979. "Functional Forms, Estimation Techniques and the Distribution of Income," Econometrica, Econometric Society, vol. 47(6), pages 1513-1525, November.
    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. Jeffrey Zax, 2016. "Provincial valuations of human capital in urban China, inter-regional inequality and the implicit value of a Guangdong hukou," ERSA conference papers ersa16p693, European Regional Science Association.
    2. Molero-Simarro, Ricardo, 2017. "Inequality in China revisited. The effect of functional distribution of income on urban top incomes, the urban-rural gap and the Gini index, 1978–2015," China Economic Review, Elsevier, vol. 42(C), pages 101-117.

    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. Gholamreza Hajargsht & William E. Griffiths & Joseph Brice & D.S. Prasada Rao & Duangkamon Chotikapanich, 2011. "GMM Estimation of Income Distributions from Grouped Data," Department of Economics - Working Papers Series 1129, The University of Melbourne.
    2. Gholamreza Hajargasht & William E. Griffiths & Joseph Brice & D.S. Prasada Rao & Duangkamon Chotikapanich, 2012. "Inference for Income Distributions Using Grouped Data," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 30(4), pages 563-575, May.
    3. Lee, Jongchul, 2013. "A provincial perspective on income inequality in urban China and the role of property and business income," China Economic Review, Elsevier, vol. 26(C), pages 140-150.
    4. Molero-Simarro, Ricardo, 2017. "Inequality in China revisited. The effect of functional distribution of income on urban top incomes, the urban-rural gap and the Gini index, 1978–2015," China Economic Review, Elsevier, vol. 42(C), pages 101-117.
    5. Qu, Zhaopeng (Frank) & Zhao, Zhong, 2008. "Urban-Rural Consumption Inequality in China from 1988 to 2002: Evidence from Quantile Regression Decomposition," IZA Discussion Papers 3659, Institute of Labor Economics (IZA).
    6. Thomas Piketty & Li Yang & Gabriel Zucman, 2019. "Capital Accumulation, Private Property, and Rising Inequality in China, 1978–2015," American Economic Review, American Economic Association, vol. 109(7), pages 2469-2496, July.
    7. Chen, Binkai & Liu, Dan & Lu, Ming, 2018. "City size, migration and urban inequality in China," China Economic Review, Elsevier, vol. 51(C), pages 42-58.
    8. Arslan Razmi, 2008. "Is the Chinese Investment- and Export-Led Growth Model Sustainable? Some Rising Concerns," UMASS Amherst Economics Working Papers 2008-09, University of Massachusetts Amherst, Department of Economics.
    9. David Warner & Prasada Rao & William E. Griffiths & Duangkamon Chotikapanich, 2011. "Global Inequality: Levels and Trends, 1993-2005," Discussion Papers Series 436, School of Economics, University of Queensland, Australia.
    10. Zhu, Nong & Luo, Xubei, 2008. "The impact of remittances on rural poverty and inequality in China," Policy Research Working Paper Series 4637, The World Bank.
    11. Gordon Anderson & Tongtong Hao & Maria Grazia Pittau, 2016. "Income Inequality, Family Formation and Generational Mobility in Urban China," Working Papers tecipa-563, University of Toronto, Department of Economics.
    12. Benjamin, Dwayne & Brandt, Loren & Giles, John, 2005. "The Evolution of Income Inequality in Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 53(4), pages 769-824, July.
    13. GOH, Chor-ching & LUO, Xubei & ZHU, Nong, 2009. "Income growth, inequality and poverty reduction: A case study of eight provinces in China," China Economic Review, Elsevier, vol. 20(3), pages 485-496, September.
    14. Peng Bin & Andrea Fracasso, 2017. "Regional Consumption Inequality in China: An Oaxaca-Blinder Decomposition at the Prefectural Level," Growth and Change, Wiley Blackwell, vol. 48(3), pages 459-486, September.
    15. Luo, Xubei & Zhu, Nong, 2008. "Rising income inequality in China : a race to the top," Policy Research Working Paper Series 4700, The World Bank.
    16. Yuwan Duan & Erik Dietzenbacher & Bart Los & Ruochen Dai, 2023. "Regional inequality in China during its rise as a giant exporter: A value chain analysis," Journal of Regional Science, Wiley Blackwell, vol. 63(1), pages 148-172, January.
    17. Camelia Minoiu & Sanjay Reddy, 2014. "Kernel density estimation on grouped data: the case of poverty assessment," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(2), pages 163-189, June.
    18. WANG, Zuxiang & SMYTH, Russell & NG, Yew-Kwang, 2009. "A new ordered family of Lorenz curves with an application to measuring income inequality and poverty in rural China," China Economic Review, Elsevier, vol. 20(2), pages 218-235, June.
    19. Celine Bonnefond, 2014. "Growth Dynamics And Conditional Convergence Among Chinese Provinces: A Panel Data Investigation Using System Gmm Estimator," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 39(4), pages 1-25, December.
    20. Gustafsson, Björn Anders & Yue, Ximing, 2006. "Rural People’s Perception of Poverty in China," IZA Discussion Papers 2486, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    Income distribution; Sampling inconsistency; Unscented Kalman filter; China;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • C46 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Specific Distributions

    Statistics

    Access and download statistics

    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:eee:chieco:v:30:y:2014:i:c:p:383-396. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/chieco .

    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.