{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

CHINA'S RETREAT FROM EQUALITY Income Distribution and Economic Transition

CHINA'S RETREAT FROM EQUALITY Income Distribution and Economic Transition

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Background image of page 2
Background image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Book Reviews CHINA’S RETREAT FROM EQUALITY: Income Distribution and Economic Transition. Edited by Cafl Riskin, flute Remuei, and Li Ski. Armani: (New York-J: MJi Sharpe. 1200!. mi. 358 pp. (Tobin graphs. J US$32. 95. paper. ISBN 0-76560691-7. When China launched its economic reform 25 years ago. it was one of the most egalitarian societies in the world. Now, however. inequality in the country has exceeded that found in most of its. Asian neighbours and in many transition economies. Such a steep rise in inequality in such a short period of time is highly unusual in human history. which has prompted many researchers to investigate various issues related to the drastic change. Written by a group of economists based in the United States. China and Europe. the 13 essays in this edited volume represent a collective eifort to document the upsurge in inequality and delineate its causes. These studies distinguish themselves from earlier ones in three aspects. First. whereas almost all others use either highly aggregated national data or datasets Covering only a limited number of localities, the 13 studies in this book make use of two detailed nationwide surveys of individual and household incomes conducted. in 1988 and 1995. For both years. the samples (10,258 rural households and 9.009 urban households in 1988. and 7.998 rural households and 6.93] urban households in 1995) were drawn from the much larger national urban and ruralsamples used by the State Statistical Bureau (358) for its own annual household surveys. Together. the two surveys provide probably the best data publicly available for the analysis of the nature. extent. evolution and sources of inequality in China as a whole. Second, they use a much broader definition of income than the one used by SSB. including. in addition to cash payments, income in kind, income from property, production for self-consumption. imputed values for government-subsidized goods and services, and rental value of owner- occupied housing. By doing so. these studies make it possible. for the first time, to measure changes in the degree of income inequality in China by an internationally comparable yardstick. Third, in contrast to most other research, these studies report and analyze results from two surveys at different points in time. Since many questions about income distribution concem trends over time. only such longitudinal data can determine the effects of the remarkable tmnsfomtation of China‘s economic system upon the distributions of individual and household incomes. The volume under review begins with an introduction that describes the two aforementioned datasets and summarizes the main findings of the following 13 substantive chapters. The rest of the book is divided into three parts. Composed of three chapters. part ! presents diverse perspectives on increasing inequality in China as a whole. Part II deals with urban China, and the four chapters here evaluate the relative contributions of various 455 Pacific Affizirs: Volume 76, No. 3 — Foil 2003 sources ol'urban income to the broad trends of growing inequality in China’s cities and towns. Part III consists of six chapters that look for patterns in the rural distribution ofincome. wealth and consumption from different angles These chapters clearly demonstrate that overall income inequality has worsened. The national Gini coefficient of income distribution rose from 0.382 in 1988 to 0.452 in 1995. Both intro-urban and intra—rural income hiequalityincreased sharply. While the urban Gini coefficient rose from 0.233 to 0.332, the rural Gini coefficient rose from 0.338 to “.416 during the seven years under study. In the meantime. the great urban—rural divide remained the dominant contributor to overall inequality. What were the main factors that contributed to increased inequality? The authors in this volume seem to have reached a consensus: it “as market- oriented reform, not economic growth per so. that was the primary cause. This is evident from the increased proportion of property income in total income, an increased reliance on private housing, and, above all, an increased payoff to education. in addition, biased government policies (e.g., subsidies in kind to urban residents and restrictions of labour mobility) are also found to have contributed to the rapid growth of inequality. Regrettably. no effort is made to examine what impact China's increased integration with the world economy has had on income distribution. Overall, supplemented by 12 figures and 149 tables, this volume is highly informative. However, many chapters are written in a manner that is intelligible only to trained economists. This problem may limit the readership of the book. The Chinese [frtivmiry qutmg Kong, Hang Kong Simooumc. WANG FINANCIAL MARKETS AND FOREIGN DIRECT INVESTMENT IN GREATER CHINA. Edited byHung-Gay FungandKem'n H. Zhang. Amumk (Nan York ), London (Engiand): ME. Sharpe (An East Gate Book). 2002. 314 pp. (Tobias, graphs, charts, figures.) US$69. 95, cloth. ISBN 0-7656-0804- 9. China received huge flows of foreign direct investment (FDI) in the 19905, with volumes far surpassing those directed at other developing countries. There is great interest in the nature and determinants of these flows, how they have afl’ected the Chinese economy, and how the economy and its institutions have adjusted in response to the flows of foreign capital. This volume. based upon a March 2000 symposium at the University of Missouri- St Louis, answers some of these questions. The papers in the first section examine the role offinancial institutions in economic development and gauge China‘s progress in terms of bank and corporate governance. They chart progress in terms oi‘financial liberalization (Fung and Wai Kin Leung), banking reform (Wai Chung Lo}. and the growth 456 Copyright of Pacific Affairs is the property of Pacific Affairs and its content may not be copied or emailed to multiple sites or posted to a listsenr without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. ...
View Full Document

{[ snackBarMessage ]}