Can Growth Compensate Inequality and Risk?---a welfare analysis for Chinese households
It has been widely observed that China's break-neck growth has not been equally shared between rural and urban areas, with urban households' enjoying a much larger proportion. To further test whether regional inequality exists within urban areas, we measure urban households vulnerability in a risky environment and decompose this measure to quantify China aggregate risks, province-level risks and idiosyncratic risks faced by households situated in 31 provinces. Besides, under this framework of analysis, we are able to make welfare comparisons between growth, inequality and different risks. We find that inequality has very big negative effect on households' welfare, while growth is able to compensate nearly half of it; households seem to be able to smooth consumption against risk in both province and individual level, but unable to do so against China shocks, which affect all the households simultaneously.
|Date of creation:||2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rothschild, Michael & Stiglitz, Joseph E., 1970. "Increasing risk: I. A definition," Journal of Economic Theory, Elsevier, vol. 2(3), pages 225-243, September.
- Ravallion, Martin & Chen, Shaohua, 2007.
"China's (uneven) progress against poverty,"
Journal of Development Economics,
Elsevier, vol. 82(1), pages 1-42, January.
- Kanbur, Ravi & Zhang, Xiaobo, 2001.
"Fifty Years Of Regional Inequality In China: A Journey Through Revolution, Reform And Openness,"
7236, Cornell University, Department of Applied Economics and Management.
- Kanbur, Ravi & Zhang, Xiaobo, 2001. "Fifty Years of Regional Inequality in China: A Journey through Revolution, Reform and Openness," CEPR Discussion Papers 2887, C.E.P.R. Discussion Papers.
- Ethan Ligon, 2007. "Risk and the Evolution of Inequality in China in an Era of Globalization," NBER Chapters, in: Globalization and Poverty, pages 599-628 National Bureau of Economic Research, Inc.
- Barro, Robert J, 2000. " Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
- Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
- Jones, Derek C. & Li, Cheng & Owen, Ann L., 2003.
"Growth and regional inequality in China during the reform era,"
China Economic Review,
Elsevier, vol. 14(2), pages 186-200.
- Derek C. Jones & Cheng Li & Ann L. Owen, 2003. "Growth and Regional Inequality in China During the Reform Era," William Davidson Institute Working Papers Series 2003-561, William Davidson Institute at the University of Michigan.
- Perotti, Roberto, 1996. " Growth, Income Distribution, and Democracy: What the Data Say," Journal of Economic Growth, Springer, vol. 1(2), pages 149-87, June.
- Ligon, Ethan & Laura Schechter, 2002.
Royal Economic Society Annual Conference 2002
128, Royal Economic Society.
When requesting a correction, please mention this item's handle: RePEc:ags:aaea06:21458. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.