How does the Economic Reform Exert Influence on Inequality in Urban China?

Shinichiro Okushima and Hiroko Uchimura

Journal of the Asia Pacific Economy, 2005, vol. 11, issue 1, 35-58

Abstract: This paper reports the results of an analysis of changes in income inequality, and in its determinants, in urban China since the economic reforms that began in 1978. The intention is to identify new characteristics of economic inequality. It first shows that income differentials across and in provinces widened and that their economic rankings were becoming fixed during the period from 1988 to 1995. Second, age was the major factor in inequality in 1988, while education became the important factor in 1995. Third, education significantly contributed to increasing inequality during the period. Fourth, the higher education-level groups had less within-group inequality. These changes reflect the penetration of the market mechanism into China after the reforms. However, this will be problematic without equality of opportunity.

Date: 2005
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DOI: 10.1080/13547860500347711

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