IDEAS home Printed from https://ideas.repec.org/p/sch/wpaper/158.html
   My bibliography  Save this paper

Fifty Years of Regional Inequality in China: A Journey Through Central Planning, Reform and Openness

Author

Listed:
  • Ravi Kanbur

    (Cornell University)

  • Xiaobo Zhang

    (IFPRI)

Abstract

This paper constructs and analyses a long run time series for regional inequality in China from the Communist Revolution to the present. There have been three peaks of inequality in the last fifty years, coinciding with the Great Famine of the late 1950s, the Cultural Revolution of the late 1960s and 1970s, and finally the period of openness and global integration in the late 1990s. Econometric analysis establishes that regional inequality is explained in the different phases by three key policy variables—the ratio of heavy industry to gross output value, the degree of decentralization, and the degree of openness.

Suggested Citation

  • Ravi Kanbur & Xiaobo Zhang, 2004. "Fifty Years of Regional Inequality in China: A Journey Through Central Planning, Reform and Openness," Working Papers 158, Institute for Social and Economic Change, Bangalore.
  • Handle: RePEc:sch:wpaper:158
    as

    Download full text from publisher

    File URL: http://www.isec.ac.in/WP%20-%20158.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Dennis Tao Yang, 1999. "Urban-Biased Policies and Rising Income Inequality in China," American Economic Review, American Economic Association, vol. 89(2), pages 306-310, May.
    2. Chen, Jian & Fleisher, Belton M., 1996. "Regional Income Inequality and Economic Growth in China," Journal of Comparative Economics, Elsevier, vol. 22(2), pages 141-164, April.
    3. Wei, Shang-Jin & Wu, Yi, 2001. "Globalization and Inequality: Evidence from within China," CEPR Discussion Papers 3088, C.E.P.R. Discussion Papers.
    4. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-625, April.
    5. Michael Sattinger (ed.), 2001. "Income Distribution," Books, Edward Elgar Publishing, volume 0, number 2018.
    6. Kanbur, Ravi, 2000. "Income distribution and development," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 13, pages 791-841, Elsevier.
    7. Qian, Yingyi & Roland, Gerard, 1998. "Federalism and the Soft Budget Constraint," American Economic Review, American Economic Association, vol. 88(5), pages 1143-1162, December.
    8. Dennis Tao Yang & Hao Zhou, 1999. "Rural-urban disparity and sectoral labour allocation in China," Journal of Development Studies, Taylor & Francis Journals, vol. 35(3), pages 105-133.
    9. 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.
    10. Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, vol. 11(1), pages 33-57, January.
    11. Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992. "Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 159-178.
    12. Fan, Shenggen & Zhang, Linxiu & Zhang, Xiaobo, 2002. "Growth, inequality, and poverty in rural China: the role of public investments," Research reports 125, International Food Policy Research Institute (IFPRI).
    13. Li, Xiao-Ming, 2000. "The Great Leap Forward, Economic Reforms, and the Unit Root Hypothesis: Testing for Breaking Trend Functions in China's GDP Data," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 814-827, December.
    14. Khan, Azizur Rahman & Riskin, Carl, 2001. "Inequality and Poverty in China in the Age of Globalization," OUP Catalogue, Oxford University Press, number 9780195136494.
    15. Jian, Tianlun & Sachs, Jeffrey D. & Warner, Andrew M., 1996. "Trends in regional inequality in China," China Economic Review, Elsevier, vol. 7(1), pages 1-21.
    16. Lyons, Thomas P, 1991. "Interprovincial Disparities in China: Output and Consumption, 1952-1987," Economic Development and Cultural Change, University of Chicago Press, vol. 39(3), pages 471-506, April.
    17. McMillan, John & Whalley, John & Zhu, Lijing, 1989. "The Impact of China's Economic Reforms on Agricultural Productivity Growth," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 781-807, August.
    18. Shorrocks, Anthony F, 1984. "Inequality Decomposition by Population Subgroups," Econometrica, Econometric Society, vol. 52(6), pages 1369-1385, November.
    19. Lin, Justin Yifu & Yang, Dennis Tao, 2000. "Food Availability, Entitlements and the Chinese Famine of 1959-61," Economic Journal, Royal Economic Society, vol. 110(460), pages 136-158, January.
    20. Kanbur, Ravi & Lustig, Nora, 1999. "Why is Inequality Back on the Agenda?," Working Papers 127690, Cornell University, Department of Applied Economics and Management.
    21. Chen, Shaohua & Ravallion, Martin, 1996. "Data in transition: Assessing rural living standards in Southern China," China Economic Review, Elsevier, vol. 7(1), pages 23-56.
    22. Xiaobo Zhang & Kevin Zhang, 2003. "How Does Globalisation Affect Regional Inequality within A Developing Country? Evidence from China," Journal of Development Studies, Taylor & Francis Journals, vol. 39(4), pages 47-67.
    23. Zhang, Tao & Zou, Heng-fu, 1998. "Fiscal decentralization, public spending, and economic growth in China," Journal of Public Economics, Elsevier, vol. 67(2), pages 221-240, February.
    24. Zhang, Xiaobo & Fan, Shenggen & Zhang, Linxiu & Huang, Jikun, 2004. "Local governance and public goods provision in rural China," Journal of Public Economics, Elsevier, vol. 88(12), pages 2857-2871, December.
    25. Fan, Shenggen & Zhang, Linxiu & Zhang, Xiaobo, 2000. "Growth and poverty in rural China: the role of public investments," EPTD discussion papers 66, International Food Policy Research Institute (IFPRI).
    26. Shenggen Fan & Xiaobo Zhang & Sherman Robinson, 2003. "Structural Change and Economic Growth in China," Review of Development Economics, Wiley Blackwell, vol. 7(3), pages 360-377, August.
    27. Xiaobo Zhang & Kevin Honglin Zhang, 2002. "Regional Inequality," Chapters, in: Shang-Jin Wei & Guanzhong James Wen & Huizhong Zhou (ed.), The Globalization of the Chinese Economy, chapter 8, Edward Elgar Publishing.
    28. Kai-yuen, Tsui, 1998. "Factor Decomposition of Chinese Rural Income Inequality: New Methodology, Empirical Findings, and Policy Implications," Journal of Comparative Economics, Elsevier, vol. 26(3), pages 502-528, September.
    29. Aaberge, Rolf & Li, Xuezeng, 1997. "The Trend in Urban Income Inequality in Two Chinese Provinces, 1986-90," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 43(3), pages 335-355, September.
    30. Shujie Yao, 1997. "Industrialization and spatial income inequality in rural China, 1986‐921," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 5(1), pages 97-112, May.
    31. Rozelle Scott, 1994. "Rural Industrialization and Increasing Inequality: Emerging Patterns in China's Reforming Economy," Journal of Comparative Economics, Elsevier, vol. 19(3), pages 362-391, December.
    32. Khan, Azizur Rahman & Griffin, Keith & Riskin, Carl & Renwei, Zhao, 1993. "Sources of income inequality in post-reform China," China Economic Review, Elsevier, vol. 4(1), pages 19-35.
    33. Gordon H. Hanson & Ann Harrison, 1999. "Trade Liberalization and Wage Inequality in Mexico," ILR Review, Cornell University, ILR School, vol. 52(2), pages 271-288, January.
    34. Lin, Justin Yifu, 1992. "Rural Reforms and Agricultural Growth in China," American Economic Review, American Economic Association, vol. 82(1), pages 34-51, March.
    35. Fan, Shenggen & Zhang, Xiaobo, 2002. "Production and Productivity Growth in Chinese Agriculture: New National and Regional Measures," Economic Development and Cultural Change, University of Chicago Press, vol. 50(4), pages 819-838, July.
    36. X. Zhang & R. Kanbur, 2001. "What Difference Do Polarisation Measures Make? An Application to China," Journal of Development Studies, Taylor & Francis Journals, vol. 37(3), pages 85-98.
    37. Hussain, Athar & Lanjouw, Peter & Stern, Nicholas, 1994. "Income inequalities in China: Evidence from household survey data," World Development, Elsevier, vol. 22(12), pages 1947-1957, December.
    38. Phillips, Peter C B & Ouliaris, S, 1990. "Asymptotic Properties of Residual Based Tests for Cointegration," Econometrica, Econometric Society, vol. 58(1), pages 165-193, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kanbur, Ravi & Zhang, Xiaobo, 2001. "Fifty Years Of Regional Inequality In China: A Journey Through Revolution, Reform And Openness," Working Papers 7236, Cornell University, Department of Applied Economics and Management.
    2. Kanbur, Ravi & Zhang, Xiaobo, 1999. "Which Regional Inequality? The Evolution of Rural-Urban and Inland-Coastal Inequality in China from 1983 to 1995," Journal of Comparative Economics, Elsevier, vol. 27(4), pages 686-701, December.
    3. Farhad Noorbakhsh & Zhikai Wang, 2010. "Interprovincial disparities in China since the reforms: convergence or divergence?," Working Papers 2010_11, Business School - Economics, University of Glasgow.
    4. Zhang, Xiaobo & Kanbur, Ravi, 2005. "Spatial inequality in education and health care in China," China Economic Review, Elsevier, vol. 16(2), pages 189-204.
    5. Lu Ming & Zhao Chen & Yongqin Wang & Yan Zhang & Yuan Zhang & Changyuan Luo, 2013. "China’s Economic Development," Books, Edward Elgar Publishing, number 14502.
    6. Zhang, Xiaobo & Fan, Shenggen, 2004. "Public investment and regional inequality in rural China," Agricultural Economics, Blackwell, vol. 30(2), pages 89-100, March.
    7. Rui Hao & Zheng Wei, 2010. "Fundamental causes of inland–coastal income inequality in post-reform China," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(1), pages 181-206, August.
    8. Ajit S. Bhalla & Shujie Yao & Zongyi Zhang, 2003. "Causes of inequalities in China, 1952 to 1999," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(8), pages 939-955.
    9. Kanbur, Ravi & Zhang, Xiao-Bo, 1998. "Which Regional Inequality? The Evolution of Rural-Urban and Inland-Coastal Inequality in China, 1983-1995," Working Papers 179359, Cornell University, Department of Applied Economics and Management.
    10. Qinghua Zhang & Heng-fu Zou, 2012. "Regional Inequality in Contemporary China," Annals of Economics and Finance, Society for AEF, vol. 13(1), pages 113-137, May.
    11. Lee, Jongchul, 2000. "Changes in the source of China's regional inequality," China Economic Review, Elsevier, vol. 11(3), pages 232-245.
    12. repec:wyi:journl:002079 is not listed on IDEAS
    13. Renkow, Mitch, 2010. "Impacts of IFPRI's "priorities for pro-poor public investment" global research program:," Impact assessments 31, International Food Policy Research Institute (IFPRI).
    14. 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.
    15. Guanghua Wan & Zhangyue Zhou, 2005. "Income Inequality in Rural China: Regression‐based Decomposition Using Household Data," Review of Development Economics, Wiley Blackwell, vol. 9(1), pages 107-120, February.
    16. Chen, Xi & Zhang, Xiaobo, 2009. "The Distribution of Income and Well-Being in Rural China: A Survey of Panel Data Sets, Studies and New Directions," MPRA Paper 20587, University Library of Munich, Germany.
    17. Sylvie Démurger & Jeffrey D. Sachs & Wing Thye Woo & Shuming Bao & Gene Chang & Andrew Mellinger, 2002. "Geography, Economic Policy, and Regional Development in China," Asian Economic Papers, MIT Press, vol. 1(1), pages 146-197.
    18. Dwayne Benjamin & Loren Brandt & Paul Glewwe & Guo Li, 2002. "Markets, Human Capital and Inequality: Evidence from Rural China," International Economic Association Series, in: Richard B. Freeman (ed.), Inequality Around the World, chapter 5, pages 87-127, Palgrave Macmillan.
    19. Iris Claus & Les Oxley & Chen Wang & Guanghua Wan & Dan Yang, 2014. "Income Inequality In The People'S Republic Of China: Trends, Determinants, And Proposed Remedies," Journal of Economic Surveys, Wiley Blackwell, vol. 28(4), pages 686-708, September.
    20. Brandt, Loren & Holz, Carsten A, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 43-86, October.
    21. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.

    More about this item

    Keywords

    REgional Inequality; China;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sch:wpaper:158. 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: . General contact details of provider: https://edirc.repec.org/data/iseccin.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: B B Chand (email available below). General contact details of provider: https://edirc.repec.org/data/iseccin.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.