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Will Polarization Occur If the Income Gap Becomes Too Wide?

Listed author(s):
  • Wang Rongbiao
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    >p>Under the traditional planned-economy system, the salaries of employees and workers were set by unified decisions on the part of the state, for which reason the salary incomes of employees and workers displayed two outstanding features: a high degree of transparency and not much differentiation. The main contradiction in income distribution was egalitarianism, even in the rural areas. Since the advent of reform and openness, these problems have gradually changed, as characterized chiefly by a rapid widening of income gaps and the emergence of many new and formerly non existent contradictions. These are manifested mainly in the three following aspects:>/p>>p>1. The widening gap between the highest and the lowest incomes in societv. "Highest" and "lowest" refer here to the most widespread and common income gaps in society. Analyses in relevant survey nxiterials show that the differences in the per capita household incomes of urban residents in China since the reform has increased year by year. These differences were 900.96 yuan, 2,536 yuan, and 3321.7 yuan in 1985, 1992, and 1993, respectively, with ratios of 1 : 0.35, 1 : 0.3 1, and 1 : 0.26, respectively.>/p>

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    Article provided by M.E. Sharpe, Inc. in its journal Chinese Economy.

    Volume (Year): 29 (1996)
    Issue (Month): 3 (May)
    Pages: 77-84

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    Handle: RePEc:mes:chinec:v:29:y:1996:i:3:p:77-84
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