The Trend of the Gini Coefficient of China

Abstract

A literature review indicates that the main problem in calculating the Gini coefficient of Chinese residents' income is the shortcomings of the data sources. Though many studies have tried to overcome these limitations through decomposing the nationwide Gini ratio by urban and rural areas, the final results have been underestimated, due to the overlap term or residual in the decomposition. This paper analyses the effects of the overlap term on calculating the overall Gini coefficient through a statistical approach, and estimates Chinese Gini ratios since economic reform and open door policies were adopted. Based on decomposing the Chinese Gini coefficient from 1978 to 2006, the authors find that the key factor of income inequality comes from income disparity between rural and urban inhabitants. The authors investigate the features of this income inequality between rural and urban areas. Furthermore, statistical approaches are employed to evaluate the effects of the development of urbanisation and rural-to-urban average income on the income inequality of the whole nation. The results show that accelerating the pace of urbanisation is the key issue to improving Chinese income disparity. On the basis of the above analysis, the paper proposes related policies for policy-makers. 1

The World Distribution of Income And Its Inequality, 1970–2009

“…() from 1981 to 2006; extrapolation on the basis of the previous trends from 2007 to 2009; (8) Our estimates; (9) Chen et al . (); (10) Our estimates; (11) Chen et al . (); (12) Our estimates.…”

“…() for 2004 and 2005, and on other official data from 2006 to 2009, on the series of rural and urban Gini coefficients as calculated in Chen et al . (), and on extrapolations of Gini coefficients from 2007 to 2009. With this information, the procedure followed in http://onlinelibrary.wiley.com/doi/10.1111/roiw.12088/suppinfo to estimate WI can be replicated by assuming that urban China and rural China are two separate countries.…”

“…(1) Data from www.indexmundi.com/facts/china/urban‐population; (2) Complement to (1); (3) PPP converted GDP per capita in PWT 7.0; (4) Our estimates on the basis of rural and urban mean incomes and rural‐urban income gaps, values in international dollars 2005; (5) Our estimates on the basis of rural and urban mean incomes and rural‐urban income gaps, values in international dollars 2005; (6)–(7) Data from Chen et al . () from 1981 to 2006; extrapolation on the basis of the previous trends from 2007 to 2009; (8) Our estimates; (9) Chen et al . (); (10) Our estimates; (11) Chen et al .…”

An Increasing Socioeconomic Gap in Childhood Overweight and Obesity in China

“…37 After fluctuating between 0.35 in 1991 and 0.37 in 1997, the Gini coefficient, a widely used measure of income inequality, increased from 0.38 in 1998 to 0.44 in 2004, where it stayed through 2006. 38 These figures may underestimate the true magnitude of income inequality in China because they do not account for grey income, the fraction of income that is unreported and is primarily acquired by high-income groups. 44 During this same period, physical activity in higher-SES families declined with urbanization, increased access to television and video games, 14,45 and increased use of motorized vehicles to transport adults to work and children to school.…”

The Fifth Milestone in the Development of Chinese Language

“…The Economic Times also reports that since 2000, no official statistics about wealth gap have been released by National Bureau of Statistics, with the argumentation that the Gini index couldn't be calculated as the incomes of urban and rural residents are calculated separately. ("China faces instability risks as gap between rich, poor widens," September 17, 2012) Further reasons are discussed in Chen et al (2010).…”