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Why Are Household Incomes More Unequally Distributed in China than in Russia?

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  • Gustafsson, Björn Anders

    (Göteborg University)

  • Li, Shi

    (Beijing Normal University)

  • Nivorozhkina, Ludmila

    (Rostov State Economic University)

Abstract

Harmonised microdata show a Gini coefficient for per capita total income of 45.3 percent in China 2002 and 33.6 percent in Russia 2003. A much larger urban to rural income gap in combination with a much smaller proportion of people living in urban areas in China are important reasons for this cross-country difference in inequality. Wage is a more non-equalising income source in China than in Russia. While Russian public transfers reduce income inequality, Chinese public transfers increase income inequality. Cross-country differences in the process of transition are also found to be significant. A relatively large non-agriculture self-employment sector is non-equalising in rural China, but is also narrowing the urban to rural income gap. In contrast to the many cross-country differences revealed, we report income inequality among urban residents in China and in urban Russia to be very similar.

Suggested Citation

  • Gustafsson, Björn Anders & Li, Shi & Nivorozhkina, Ludmila, 2010. "Why Are Household Incomes More Unequally Distributed in China than in Russia?," IZA Discussion Papers 5383, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp5383
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    References listed on IDEAS

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    1. Herrold-Menzies, Melinda, 2009. "The Post-Collective Village: A Tale of Two Transitions," World Development, Elsevier, vol. 37(1), pages 232-241, January.
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    Cited by:

    1. Jérôme Lefranc, 2012. "Polarisation et déclin de la classe moyenne : le cas de la Russie," Post-Print halshs-00775929, HAL.
    2. Jérôme Lefranc, 2012. "Polarisation et déclin de la classe moyenne : le cas de la Russie," Documents de travail du Centre d'Economie de la Sorbonne 12054, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    3. Marginson, Simon, 2018. "Higher education, economic inequality and social mobility: Implications for emerging East Asia," International Journal of Educational Development, Elsevier, vol. 63(C), pages 4-11.

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      Keywords

      inequality; China; public transfers; income distribution; Russia;
      All these keywords.

      JEL classification:

      • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
      • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
      • P52 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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