Regional Income Inequality and Economic Growth in China

Chen, Jian; Fleisher, Belton M.

doi:10.1006/jcec.1996.0015

Cited by 423 publications

(272 citation statements)

References 17 publications

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“…Raiser (1998) also notes similar evidence of absolute convergence using regional data in 1978-92. Huo (1994) and Chen and Fleisher (1996) observe similar results.…”

Section: Introductionmentioning

confidence: 56%

“…The CV not only quantifies the income inequality problem but also measures the development of income gap between different economies. It has been widely used in the literature, such as Lyons (1991), Tsui (1996), Chen and Fleisher (1996), Raiser (1998), Zheng, Xu and Tang (2000), Xu and Zou (2000), Wu (2002) and Chang (2002). The CV index in these studies is calculated by the net material product, national income, or per capita GDP in nominal or real value to assess the evolution of regional income inequality in the preand post-reform periods.…”

Section: σ-Convergencementioning

confidence: 99%

“…To examine absolute β-convergence, the simple regression that was suggested in Baumol (1986) and applied in Chen and Fleisher (1996), Jian, Sachs and Warner (1996), Gundlach (1997), Raiser (1998), Zhang (2001 and Yao and Zhang (2001b) will be adopted in this research, to regress the growth rate of real GDP (RGDP) per capita against the beginning period's level of RGDP per capita. The regression function is specified as:…”

Section: β-Convergencementioning

confidence: 99%

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Foreign Direct Investment and Regional Inequality in China

2007

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China's economic miracle over the past three decades has been featured with its open-door policy, especially the absorption of foreign capital. One downside effect of economic reform has been the ever rising interregional inequality. As FDI is highly unevenly distributed across regions, many scholars and policymakers have blamed their inflows as one of the main factors driving the Chinese regions apart. If this logic were true, then controlling the scale of FDI could be a solution to reduce regional inequality. However, it is difficult to reconcile the positive effect of FDI on economic growth with its potential 'negative' effect on regional inequality. This is a controversial and provocative issue in the economic development literature. Using the largest panel dataset covering all the Chinese regions over the entire period 1979-2003 and employing an augmented Cobb-Douglas production function, this paper proves that FDI has been an important factor responsible for regional growth differences in China. However, it suggests that FDI cannot be blamed for causing regional inequality; it is the uneven distribution of FDI instead of FDI itself that has caused regional growth differences. The key policy issue is that FDI should be guided towards the inland areas with preferential policies in order to improve the spatial allocation of investments as a means to reduce regional inequality.

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“…Raiser (1998) also notes similar evidence of absolute convergence using regional data in 1978-92. Huo (1994) and Chen and Fleisher (1996) observe similar results.…”

Section: Introductionmentioning

confidence: 56%

Section: σ-Convergencementioning

confidence: 99%

Section: β-Convergencementioning

confidence: 99%

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Foreign Direct Investment and Regional Inequality in China

2007

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Section: (2) Related Literaturementioning

confidence: 99%

“…A large part of the literature on inequality in China focuses on spatial differences between coastal and interior regions, and across rural and urban areas (see, among others, Fleisher et al (2010), Kanbur and Zhang (2005), Chen and Fleisher (1996), Knight and Song (1999), Park (2008) is partly responsible for our focus on non-farm occupations is that non-farm income has 13 As we discuss later, the farm and nonfarm distinction carries different meanings before and after the reform, because the policies implemented during the Maoist era (in particular the cultural revolution) were aimed at enhancing the social position of peasants and improving educational mobility of their children (see, among others, Hannum and Xie (1994), Sato and Li (2007), and Hannum et al (2008)). …”

mentioning

confidence: 99%

Are the Children of Uneducated Farmers Doubly Doomed? Farm, Nonfarm and Intergenerational Educational Mobility in Rural China

Emran

Sun

2014

SSRN Journal

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This paper relaxes the single factor model of intergenerational educational mobility standard in the literature, and develops a research design to study the effects of parents' education and occupation on children's schooling. We use survey data from rural China that cover three generations and are not subject to coresidency bias. The evidence from recently developed matching and propensity score weighted estimators shows that the mean effects of parents education from the standard model miss substantial heterogeneity. Within the low education subsample, a son (girl) attains about 0.80 (0.60) years of additional schooling when born into a non-farm household compared to a farm household, and among the farming households, a child gains a one year of schooling when at least one parent has more than primary schooling. Having nonfarm parents, however, does not confer any advantages over the farmer parents if the farmers are relatively more educated, even though nonfarm households have significantly higher income. This suggests that income plays a secondary role to parental education. Estimates of cross-partial effects without imposing functional form show little evidence of complementarity between parental education and non-farm occupation. The role of family background remains stable across generations for girls, but for boys, family background has become more important after the market reform.Key Words: Educational Mobility, Inequality, Rural China, Nonfarm, Education and Occupation, Family Background, Heterogeneity, Complementarity, Market Reform, Gender Gap JEL Codes: O12, J621 We would like to thank Li Shi, Zhan Peng, and Song Jin for help with the CHIP survey data, and Matthew Lindquist and Forhad Shilpi for helpful comments and/or discussions. (1) IntroductionIncreasing inequality despite sustained economic growth and poverty reduction in last few decades has become a central policy issue in both developed and developing countries (Stiglitz (2012), Rajan (2010), Picketty (2014)). Inequality and its negative effects have also been high on the agenda of the Chinese policymakers in recent years. 2 There is a broad consensus among the policy makers and academic economists that education is one of the most important policy instruments to make the playing field level for children from the poor socio-economic background, and moderate the inequality generated by market reform. It is thus important to understand potential disadvantages faced by children from a poor socio-economic background in attaining the education and skills required in an increasingly globalized and skill-based labor market.The economics literature on intergenerational educational mobility has focused on parental education as the relevant indicator of family background for understanding intergenerational linkages (see Bjorklund and Salvanes (2011) for a recent survey, and on China, see, among others, Knight et al. (2013), Sato and Li (2007), Emran and Sun (2011)). This emphasis on parental education is eminently appropriate when the goal is...

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