The issue of whether inequality is rising or falling in China is not a trivial one.
Since the beginning of the reform and opening up in 1978 inequality widened and carried on widening for many years. In a Discussion Paper for the International Food Policy Research Institute Ravi Kanbur and Yue Wang of Cornell University and Xiaobo Zhang from Peking University took at a look at more recent trends though, about which less is known.
The title of their paper sort of gives their findings away. Since around 2010 inequality stopped widening in China and has since then either plateaued or come down some. That’s good news of course but the curious will now ask why?
The authors suggest a number of factors at work: Minimum wage legislation introduced in the early noughties being increasingly implemented, rural cooperative medical insurance, another early noughties introduction, and rural social security, introduced in 2009
Here is another proof of a long-held contention that China has problems, for sure; but it also has an energetic administration tackling the most pressing ones.
The authors conclude ‘Although China’s inequality has come to a turnaround, the level is still rather high compared with many countries. More efforts are still needed to keep the momentum.’ A cadre’s work is never done.
You can access the paper in full via this link Inequality Turnaround.
Happy Sunday