The Urban-Rural Income Gap and Inequality in China
Using new household survey data for 1995 and 2002, we investigate the size of China's urban-rural income gap, the gap's contribution to overall inequality in China, and the factors underlying the gap. Our analysis improves on past estimates by using a fuller measure of income, adjusting for spatial price differences and including migrants. Our methods include inequality decomposition by population subgroup and the Oaxaca-Blinder decomposition. Several key findings emerge. First, the adjustments substantially reduce China's urban-rural income gap and its contribution to inequality. Nevertheless, the gap remains large and has increased somewhat over time. Second, after controlling for household characteristics, location of residence remains the most important factor underlying the urban-rural income gap. The only household characteristic that contributes substantially to the gap is education. Differences in the endowments of, and returns to, other household characteristics such as family size and composition, landholdings, and Communist Party membership are relatively unimportant. Copyright � 2007 The Authors; Journal compilation � International Association for Research in Income and Wealth 2007.
(This abstract was borrowed from another version of this item.)
|Date of creation:||2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.wider.unu.edu/
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.:
- Knight, John & Song, Lina, 1999. "The Rural-Urban Divide: Economic Disparities and Interactions in China," OUP Catalogue, Oxford University Press, number 9780198293309, March.
- David E. Sahn & David C. Stifel, 2003.
"Urban--Rural Inequality in Living Standards in Africa,"
Journal of African Economies,
Centre for the Study of African Economies (CSAE), vol. 12(4), pages 564-597, December.
- Sahn, David E. & Stifel, David C., 2004. "Urban-Rural Inequality in Living Standards in Africa," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Zhang, Xiaobo & Fan, Shenggen, 2004.
"Public investment and regional inequality in rural China,"
Blackwell, vol. 30(2), pages 89-100, March.
- Zhang, Xiaobo & Fan, Shenggen, 2000. "Public investment and regional inequality in rural China:," EPTD discussion papers 71, International Food Policy Research Institute (IFPRI).
- Xiaobo Zhang & Ravi Kanbur, 2004.
"Spatial Inequality in Education and Health Care in China,"
159, Institute for Social and Economic Change, Bangalore.
- Zhang, Xiaobo & Kanbur, Ravi, 2005. "Spatial inequality in education and health care in China," China Economic Review, Elsevier, vol. 16(2), pages 189-204.
- Kanbur, Ravi & Zhang, Xiaobo, 2003. "Spatial Inequality in Education and Health Care in China," CEPR Discussion Papers 4136, C.E.P.R. Discussion Papers.
- Zhang, Xiaobo & Kanbur, Ravi, 2003. "Spatial Inequality In Education And Health Care In China," Working Papers 127256, Cornell University, Department of Applied Economics and Management.
- 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.
- Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
- Miles, David, 1997. "A Household Level Study of the Determinants of Incomes and Consumption," Economic Journal, Royal Economic Society, vol. 107(440), pages 1-25, January.
- 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.
- Loren Brandt & Carsten A. Holz, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55, pages 43-86.
- Loren Brandt & Carsten Holz, 2005. "Spatial Price Differences in China: Estimates and Implications," Microeconomics 0512001, EconWPA.
- Loren BRANDT & Carsten A HOLZ, 2005. "Spatial Price Differences in China: Estimates and Implications," Development and Comp Systems 0504010, EconWPA.
- Yang, Dennis T. & Hao Zhou, 1997.
"Rural-Urban Disparity and Sectoral Labor Allocation in China,"
97-02, Duke University, Department of Economics.
- 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.
- Carlos Gradín (a) & Olga Cantó & Coral del Río, .
"Inequality, Poverty And Mobility: Choosing Income Or Consumption As Welfare Indicators,"
18-04 Classification-JEL , Instituto de Estudios Fiscales.
- Carlos Gradín & Olga Cantó & Coral del Río, 2008. "Inequality, poverty and mobility: Choosing income or consumption as welfare indicators," Investigaciones Economicas, Fundación SEPI, vol. 32(2), pages 169-200, May.
- Fan, Shenggen & Zhang, Linxiu & Zhang, Xiaobo, 2004. "Reforms, Investment, and Poverty in Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 52(2), pages 395-421, January.
- Shorrocks, Anthony F, 1984. "Inequality Decomposition by Population Subgroups," Econometrica, Econometric Society, vol. 52(6), pages 1369-85, November.
- Shorrocks, Anthony & Wan, Guanghua, 2004.
"Spatial Decomposition of Inequality,"
Working Paper Series
UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Jonathan Morduch & Terry Sicular, 1998.
"Politics, Growth and Inequality in Rural China: Does It Pay To Join the Party?,"
Harvard Institute of Economic Research Working Papers
1832, Harvard - Institute of Economic Research.
- Morduch, Jonathan & Sicular, Terry, 2000. "Politics, growth, and inequality in rural China: does it pay to join the Party?," Journal of Public Economics, Elsevier, vol. 77(3), pages 331-356, September.
- Ronald L. Oaxaca & Michael R. Ransom, 1999. "Identification in Detailed Wage Decompositions," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 154-157, February.
- X. B. Zhao & S. P. Tong, 2000. "Unequal Economic Development in China: Spatial Disparities and Regional Policy Reconsideration, 1985-1995," Regional Studies, Taylor & Francis Journals, vol. 34(6), pages 549-561.
When requesting a correction, please mention this item's handle: RePEc:unu:wpaper:rp2006-135. 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: (Bruck Tadesse)
If references are entirely missing, you can add them using this form.