More unequal yet more alike, the changing patterns of family formation, generational mobility and household income inequality in China: a counter-factual analysis

Abstract

China's household income inequality has grown steadily over the last 30 years. While many analyses focus on the effects of policies relating to urban-rural and inland-coastal distinctions, growth in inequality has prevailed on both sides of those respective divides suggesting something more fundamental is at play. Here, certain patterns of family formation and human capital transfer are shown to engender increases in household income inequality measures. A unique data set, linking grandparents, parents and children, yields evidence of structural change toward such patterns over successive cohorts of households. Influenced by such events as the Cultural Revolution, the One Child Policy and the Economic Reforms, people intensified positive assortative matching behaviors and polarizing human capital transitions. Social class designations became less important and educational class designations became more important. A counterfactual analysis verified the impact of these changes on household income inequality in urban China, revealing increasing similarity between cohorts amidst growing inequality.

Regional inequality of resident income and its determinants: A case study of Zhejiang Province, China

“…The interhousehold disparity is considered as the micro source and basic form of income inequality in China, and relevant study has been widely conducted (Anderson et al, 2019;Li & Sicular, 2014;Xie & Jin, 2015). Paul et al (2017) investigated the effects of household income sources on the level and rise of inequality in urban China, based on the householdlevel data from the Chinese Household Income Project Surveys (CHIPS).…”

The Chinese Inland-Coastal Inequality: The Role of Human Capital and the 2007–2008 Crisis Watershed

“…Recent studies demonstrate that, in a context of education polarization, income inequality increasingly depends on the level of HC(Anderson et al 2019). According toHeckman (2005), in order to favor convergence based on the role of education, some form of public support for families may be necessary, as well as fostering college loan schemes for poor families.…”