China Income Inequality Research Paper

Gary Becker’s and Kevin Murphy’s “The Upside of Income Inequality” analyzes the correlation between overall economic development, the importance of education and the effects it has on increasing income inequality. Becker’s and Murphy’s article presents a study taken in China that shows the increase in income inequality raising at similar rates as economic growth. This ultimately leads to a decrease in the amount of people facing poverty and better living conditions for the poor. During China’s rapid rate of economic development “inequality rose, [but] the number of Chinese who live in poverty fell from 260 million in 1978 to 42 million in 1998. Despite the widening gap in incomes, rapid economic development dramatically improved the lives of China’s poor” (Becker and Murphy 581). The authors also state that income inequality is in fact a natural result of economic development because it “raised the standard of living for both the rich and the poor” (Becker and Murphy 582). Education also effects the average earnings of Americans. The importance of receiving an education has

"Income Inequality: Views & Solutions From Experts - Financesonline.com." Financesonlinecom Income Inequality Views Solutions From

Increased income inequality is shown to increase the poverty rate. This is shown as more income moves apart from lower income brackets to upper income brackets. The Economic Policy Institute estimated that increased income inequality has increased 5.5 percent in from the year 1979 to 2007. This increase in poverty is reflected directly from income inequality as the bottom laborers in a business are working harder and gaining less, as the top workers, the CEO’s, and other executives are spending less time working, and more time counting their money. Income deprivation has been the largest driver of change in poverty rate, much above other factors such as economic growth, education, and race.

Income inequality is increasingly becoming a significant concern for many countries around the world. The income difference between the highly-educated, skilled, wealthy class and the poor, low to mid-skilled workers is growing larger and larger. In fact, the incomes of the rich are increasing significantly, while the low skilled workers’ incomes have been declining (The Economist, “Wealth Without Workers”). According to The Economist, real median wages have been decreasing since 2000 in half of the member countries in the Organisation for Economic Co-operation and Development (OECD). In the United States, there was a 4% increase from 1980 to 2012 in the share of national income that was distributed to the top 0.01% (The Economist, “True Progressivism”). Canada is facing a similar problem of rising inequality.

Gan, Li, et al. "Reducing Inequality: Taking From The Top To Distribute At The Bottom." China Perspectives 2013.3 (2013): 80-82. Academic Search Complete. Web. 29 Oct. 2015. Gan et al. examine the true scope and detail of the income disparity present in contemporary Chinese society. This work examines the introduction of government measures, the criticisms and inadequacies of these supposed measures, other potential solutions that have been proposed, as well as whether or not the Chinese government has the true ability and willingness to carry out the new

In any given population, there is a difference between what people within the population earn. The uneven distribution of income in any given population is income inequality. In order for there to be income, there has to be several sources of income. These sources of income may be combinational or independent per person receiving the income. Income may result from wages, rent, bank account interests, salaries or even profits made in business transactions ( Stiglitz, 2012).

16,2015, The New Yorker. Jill Lepore discusses economic inequality how its been measured by a

One of the social issues concerning power, status, and class in American society today is income inequality. The income gap between the social classes has increased drastically throughout the last few decades, creating a significant gap between the wealthy and the poor. This gap has become so large that the middle class has nearly diminished, creating a social class comprised of the rich and the poor. The significant gap between the two social classes is unhealthy for the economy because it provides too much power in the hands of those with high social status.

Dr. Hao Jingfang works for the China Development Research Foundation which helps advance and promote economic development and social progress. She conducts research with an emphasis on rural poverty and presents recommendations to the government. Dr. Hao has witnessed and learned about China’s development over the last century, such as the Cultural Revolution-the birth of communist ideals- and capitalism. China transformed their system and has been ascending economically for the last several decades. Dr. Hao Jingfang had also witnessed its side effects: the excellent ever increasing gross domestic product(GDP) and the not so good effects of increased poverty. Another one of the of the not so spectacular side effects are how the wealth,

The liberalisation of their markets and the mobilisation of 1 billion workers allowed huge wealth to be generated and huge disparities to develop. The biggest differences in China are between rural and urban areas, particularly between the megacities of the East and the ethnic rural areas of the East (Including Tibet), culturally there are huge differences with the Han Chinese having far more opportunities and wealth. The restrictions in China on rural to urban migration mean that rural dwellers do not have the same opportunities as those in the cities. China as a result has the largest disparity between its citizens, both economically and socially, It’s not just NIC’s that have huge disparities in wealth, MEDC’s such as the USA also suffer from widespread disparity, this was clearly seen during Hurricane Katrina where the majority of the dead were poorer Afro Caribbean communities who did not have access to education, information or basic transport. This is a problem across America where those who can engage with ‘The American Dream’ have access to huge wealth and opportunity but those born into poor areas statistically stay poor. The world’s largest economy should not have hundreds of thousands of homeless people on their streets.

Austin, Michael. “Wealth, Poverty and Social Class” Reading the World 2nd Ed 5.10 (2010): 369-380. Print

Poverty is still a worldwide problem in the 21st century, which urgently needs to be tackled. As one of the rapidly growing and influential nations in the international society, it is significant to look into the poverty alleviation programs of the People’s Republic of China (hereinafter referred to as China) as well as how Chinese institutional factors affect income inequality. Since the world’s economy is highly dependent upon China, it is important and timely to examine what problems and solutions China has in terms of poverty reduction and income disparity between the urban and rural areas.

The rapid economic growth was perceived as an airbag against the threat of urban poverty. However the gradual alienation of a particular segment of the unemployed alarmed the officials about the irreversibility and respective social tension in the society. Fulong Wu & Ningying Huang defines those as the “outsiders” of the Chinese society who are living in the poverty line of $1 (PPP) as determined by the World Bank. Those outsiders have no hope of returning to the labor market. For that matter there is defined a new urban poverty in China that could even impede the economic growth if remained neglected. In such circumstances without

According to World Bank (2010), China’s gross domestic production (GDP) reached as much as $5,930,529,470,799 in 2010, when for the first time China ranked the second in the world following the United States and surpassed Japan, and has been maintain the ranking in the following years with larger gap outperforming Japan. Moreover, the annual growth rate of China’s GDP has averaged over 9 percent in the last 3 decades (World Bank, 2010), with no other country having achieved such rapid developmental success as China in the world (Turin, 2010). As the country with the largest population in the world, China has lifted 300 million of its citizen out of poverty (Ramo, 2004), attributed to 67% of the total reduction of global poverty during the last 25 years” (People’s Daily, 2008; Turin, 2010), and people living at less than $1 a day has sharply declined to 13.4% in 2003 and further to 8% in 2009 from 60% in 1980 (Sahoo, Dash & Nataraj, 2010). China’s dramatic rapid economic growth has been a miracle of in the world. Reflecting the notion that as one of the most significant emerging economies, the world centre may be shifted to China, thus a couple of research studies have turned their attention from western advanced economies’ to China, trying to find out a model that can perfectly explain such growth, Some scholars contribute China’s success to the incentives of Asian Flying Geese Model. Hemphill & White (2013) claim

Meanwhile, a similar situation is witnessed in China. In the past decades since 1990, the growth performance of the Chinese economy has been rising fast with an annual per capita growth rate of approximately 9%. During this period, living standards in China have improved significantly with rapid poverty reduction (Chen, 2007; Ravallion, 2008). To be more precise with statistics, from 1989 to 2004, income in Chinese inland provinces doubled (from 1149 yuan to 3537 yuan), while that in coastal provinces, more than tripled (from 982 yuan to 2338 yuan). This 15-year period has seen the more rapid growth in urban areas of both coastal and inland provinces. In rural areas, average household per capita income rose 2.5 times and in urban areas, it multiplied 3 times (Goh et al, 2008).