Income inequality and mobility of rural households in China from 2003 to 2006

Wenkai Sun (School of Economics, Renmin University of China, Beijing, China)
Xianghong Wang (School of Economics, Renmin University of China, Beijing, China)
Chong-En Bai (School of Economics and Management, Tsinghua University, Beijing, China)

China Agricultural Economic Review

ISSN: 1756-137X

Publication date: 28 January 2014

Abstract

Purpose

This paper aims to illustrate the trends of income growth and income inequality and examines the dynamics and determinants of income mobility in rural China from 2003 to 2006.

Design/methodology/approach

The authors decomposed the Gini coefficient by different sources and analyzed income mobility using the method of income transition matrix. The authors then estimated the effects of demographic variables, labor migration, and other household characteristics on income growth using a dynamic panel data model.

Findings

The study obtained important findings on income mobility and income inequality in rural China. First, annual income inequality in rural China was smoothed during this period after a decline from 2003, with the largest contribution from the income of migration work. Second, income mobility remained rather stable and relatively high, with higher mobility in the interior provinces than in the coastal provinces. Third, the income levels of the poor and the wealthy households converged during this period after controlling other factors. Fourth, income growth depends on in the households' demographic composition, their human capital accumulation, and their chances of getting migration jobs.

Originality/value

The sound econometric methods applied to the most current rural household survey data provide important contributions to the literature of income inequality and income mobility in China.

Keywords

Citation

Sun, W., Wang, X. and Bai, C. (2014), "Income inequality and mobility of rural households in China from 2003 to 2006", China Agricultural Economic Review, Vol. 6 No. 1, pp. 73-91. https://doi.org/10.1108/CAER-12-2011-0161

Download as .RIS

Publisher

:

Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited

Please note you might not have access to this content

You may be able to access this content by login via Shibboleth, Open Athens or with your Emerald account.
If you would like to contact us about accessing this content, click the button and fill out the form.
To rent this content from Deepdyve, please click the button.