China's Household Income and Its Distribution, 1995 and 2002

Abstract

A new, independently designed household income survey for China in 2002 shows some decline in income inequality in both rural and urban China since 1995. However, the overall Gini ratio for China remained unchanged due to a rise in the urban–rural income gap. The reduction in rural inequality stemmed mainly from a fall in both inter-provincial inequality and inequality within most of the provinces, as well as from a further improvement in the distribution of wage income and farm income and a reduction in the regressiveness of net taxes. The reduction in urban inequality came from a fall in inter-provincial inequality and better distribution of imputed rental income and net taxes. The results raise questions about whether recent more equity-oriented policies, such as the “great western development strategy,” began to reduce some dimensions of overall income inequality. For the first time, a special survey was implemented to furnish data on migrants living in towns and cities. Incorporating the migrants into the urban population raises urban inequality and reduces the urban–rural gap somewhat, but leaves the latter still very high by international standards.

Poverty and Exclusion of Minorities in China and India

“…We compared our Gini estimates using the Yao (1999a) method with those of Khan and Riskin (2005). 3 Both methods gave roughly the same ranking of provinces (for example, for the rural areas, both methods estimated the lowest Gini ratio for Guangxi and the highest Gini ratio for Zhejiang and Beijing).…”

“…3. Khan and Riskin (2005) use the CASS household survey data for 1995 and 2002 to compare China's household income and its distribution. They estimated some decline in rural and urban income inequality from 1995 to 2002.…”

Migrants as second-class workers in urban China? A decomposition analysis

“…Within cities, only rural-urban migrant households living in residential neighborhoods were sampled. This implies that migrant workers living on construction sites or in factory dormitories are not accounted for (Khan and Riskin 2005). 9 With little outside knowledge about the distribution of the migrant population by age, gender, and location, it is difficult to make a judgment on how representative the migrant data is.…”

“…It enables the comparison of two sub-populations that may be in strong competition for jobs in urban China. Indeed, rural migrants surveyed in the CHIP data were selected from resident communities (Khan and Riskin 2005). Although not capturing the wide spectrum of rural migrants (those living in construction sites and factories were excluded from the sampling process), these data are relevant for the purpose of our study since the surveyed migrants, already settled in cities, can be expected to have characteristics closer to urban residents against whom they are competing in the labor market.…”

Knowing One’s Lot in Life Versus Climbing the Social Ladder: The Formation of Redistributive Preferences in Urban China

“…On the other hand, the marketisation process has generated growing income inequities between the 'haves' and 'have nots' (see e.g. Gustafsson and Li 2001;Khan and Riskin 2005;World Bank 1997). There are whole segments of the urban population, such as workers retrenched from the state-owned sector, who once held privileged positions in Maoist China, but whom the reforms have left behind.…”