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Urbanization and Urban-Rural Inequality in China: A New Perspective from the Government¡¯s Development Strategy

Author

Listed:
  • Justin Yifu Lin

    (The World Bank, Washington, DC 20433, USA)

  • Binkai Chen

    (School of Economics, Central University of Finance and Economics, Beijing 100083, China)

Abstract

This paper offers a novel explanation for the lower urbanization rate and great urban-rural inequality in China. Our study reveals that, heavy-industry-oriented development strategy will result in lower urbanization rate and higher urban-rural inequality. The greater the degree of heavy-industryoriented development strategy is, the lower the urbanization rate is, and the higher the urban-rural inequality is. From a dynamic perspective, heavy-industryoriented development strategy reduces the capital accumulation rate, which results in a slower progress of urbanization and a highly persistent urban-rural inequality. The higher the degree of heavy-industry-oriented development strategy, the slower the progress of urbanization, and the longer the urban-rural inequality will last. This mechanism can potentially explain the lower urbanization rate and higher urban-rural inequality in China under a unified framework.

Suggested Citation

  • Justin Yifu Lin & Binkai Chen, 2011. "Urbanization and Urban-Rural Inequality in China: A New Perspective from the Government¡¯s Development Strategy," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 6(1), pages 1-21, March.
    • Handle: RePEc:fec:journl:v:6:y:2011:i:1:p:1-21
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    File URL: http://journal.hep.com.cn/fec/EN/10.1007/s11459-011-0119-3
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    Citations

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    Cited by:

    1. Guo Chen & Amy K Glasmeier & Min Zhang & Yang Shao, 2016. "Urbanization and Income Inequality in Post-Reform China: A Causal Analysis Based on Time Series Data," PLOS ONE, Public Library of Science, vol. 11(7), pages 1-16, July.
    2. Jing Li & Tsun Se Cheong & Jianfa Shen & Dahai Fu, 2019. "Urbanization And Rural–Urban Consumption Disparity: Evidence From China," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 64(04), pages 983-996, September.
    3. Wenli Cheng & Yongzheng Wu, 2017. "Understanding the Kuznets Process—An Empirical Investigation of Income Inequality in China: 1978–2011," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 134(2), pages 631-650, November.
    4. Wang, Xiang & Shao, Shuai & Li, Ling, 2019. "Agricultural inputs, urbanization, and urban-rural income disparity: Evidence from China," China Economic Review, Elsevier, vol. 55(C), pages 67-84.
    5. Qiuyang Zhou & Zhenqiang Li, 2021. "The impact of industrial structure upgrades on the urban–rural income gap: An empirical study based on China's provincial panel data," Growth and Change, Wiley Blackwell, vol. 52(3), pages 1761-1782, September.
    6. Tang, Le & Sun, Shiyu, 2022. "Fiscal incentives, financial support for agriculture, and urban-rural inequality," International Review of Financial Analysis, Elsevier, vol. 80(C).
    7. Brasili, Cristina & Barone, Barbara & Bin, Peng, 2014. "Regional Disparity of Vulnerability to Food Insecurity in China," 2014 Third Congress, June 25-27, 2014, Alghero, Italy 173107, Italian Association of Agricultural and Applied Economics (AIEAA).
    8. Tang, Jianjun & Gong, Jiaowei & Ma, Wanglin & Rahut, Dil Bahadur, 2022. "Narrowing urban–rural income gap in China: The role of the targeted poverty alleviation program," Economic Analysis and Policy, Elsevier, vol. 75(C), pages 74-90.
    9. Wang, Siliang & Tan, Shukui & Yang, Shengfu & Lin, Qiaowen & Zhang, Lu, 2019. "Urban-biased land development policy and the urban-rural income gap: Evidence from Hubei Province, China," Land Use Policy, Elsevier, vol. 87(C).
    10. Chiqun Hu & Xiaoyu Ma & Yangqing Liu & Jiexiao Ge & Xiaohui Zhang & Qiangyi Li, 2023. "Mechanism and Spatial Spillover Effect of New-Type Urbanization on Urban CO 2 Emissions: Evidence from 250 Cities in China," Land, MDPI, vol. 12(5), pages 1-25, May.
    11. Zixing Wang & Meirong Zhang, 2023. "The Distributional Effects Associated with Land Finance in China: A Perspective Based on the Urban–Rural Income Gap," Land, MDPI, vol. 12(9), pages 1-15, September.

    More about this item

    Keywords

    development strategy; urbanization; urban-rural inequality;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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