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Income distribution trends in Brazil and China: Evaluating absolute and relative economic growth

  • Coes, Donald V.
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    Over the past two decades real per capita income has increased significantly in Brazil and spectacularly in China. Relative inequality in the distribution of income, however, has remained high in Brazil and has worsened in China. This paper uses a "stochastic dominance" approach to evaluate the welfare effects of a combination of rising mean per capita income in the context of worsening relative inequality. It concludes that by this criterion economic welfare in Brazil increased slightly in the 1981-2002 period. In China, the rapid increase in mean per capita was more than sufficient to overcome significantly increased relative inequality. Between 1985 and 2001 economic welfare thus increased substantially. The overall increase in welfare in both countries, however, is more complex when analyzed by consideration of specific time periods or by rural-urban decomposition.

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    File URL: http://www.sciencedirect.com/science/article/pii/S1062-9769(07)00034-8
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    Article provided by Elsevier in its journal The Quarterly Review of Economics and Finance.

    Volume (Year): 48 (2008)
    Issue (Month): 2 (May)
    Pages: 359-369

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    Handle: RePEc:eee:quaeco:v:48:y:2008:i:2:p:359-369
    Contact details of provider: Web page: http://www.elsevier.com/locate/inca/620167

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    1. Cheng Fang & Eric Wailes & Gail Cramer, 1998. "China's Rural and Urban Household Survey Data: Collection, Availability, and Problems," Center for Agricultural and Rural Development (CARD) Publications 98-wp202, Center for Agricultural and Rural Development (CARD) at Iowa State University.
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    4. Wu, Ximing & Perloff, Jeffrey M., 2004. "China's Income Distribution over Time: Reasons for Rising Inequality," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt166747gz, Department of Agricultural & Resource Economics, UC Berkeley.
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    9. Foster, James E. & Shorrocks, Anthony F., 1988. "Inequality and poverty orderings," European Economic Review, Elsevier, vol. 32(2-3), pages 654-661, March.
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