Household Income Dynamics In Rural China

Is effective social protection an investment with long-term benefits? Does inequality impede growth? Household panel data on incomes in rural China offer some answers.

Is effective social protection an investment with long-term benefits? Does inequality impede growth? Household panel data on incomes in rural China offer some answers. Theoretical work has shown that nonlinear dynamics in household incomes can yield poverty traps and distribution-dependent growth. If this is true, the potential implications for policy are dramatic: Effective social protection from transient poverty would be an investment with lasting benefits, and pro-poor redistribution would promote aggregate economic growth.Jalan and Ravallion test for nonlinearity in the dynamics of household incomes and expenditures using panel data for 6,000 households over six years in rural southwest China. While they find evidence of nonlinearity in the income and expenditure dynamics, there is no sign of a dynamic poverty trap.The authors argue that existing private and social arrangements in this setting protect vulnerable households from the risk of destitution. However, their findings imply that the speed of recovery from an income shock is appreciably slower for the poor than for others. They also find that current inequality reduces future growth in mean incomes, though the quot;growth costquot; of inequality appears to be small. The maximum contribution of inequality is estimated to be 4-7 percent of mean income and 2 percent of mean consumption.This paper - a product of the Poverty Team, Development Research Group - is part of a larger effort in the group to better understand the dynamic processes influencing household welfare in risk-prone environments.

Since being established in 1949 OCo and especially since the reform and opening up 30 years ago OCo China has experienced the most drastic changes ever in its 5000-year history. During this period, China has transformed from an agricultural society into an emerging, dynamic, and industrialized nation and has undergone rapid urbanization. The standard of living of the Chinese continues to rise and is taking rapid strides forward to a higher level of comprehensive well-being. China''s development over the past 60 years has indicated that the livelihood of the people is a key factor in economic and social construction in contemporary China. Having sufficient food and clothing is the first step in improving the livelihood of the people. A higher level of well-being can be achieved only after the basic needs are met. This higher level of well-being comprises of employment as the foundation, education as the key point, income distribution as the source, social security as the support, and public safety as an assurance. This book offers fresh perspectives by prestigious scholars from the Chinese Academy of Social Sciences. Based on a unique source of data which is available only to Chinese scholars, this book showcases key issues on people''s livelihood and social construction in Contemporary China, including income disparity, social security system, employment situation, post-80s generation and so on.

This book analyses the impact of the current economic reform on the income development of peasant households in the People's Republic of China. The research is based on detailed information derived from book-keeping records of the sample households of selected regions in central China, the national statistical network, local statistics and chronicles. Moreover, the basic tools of economic analysis are applied to the main problems of the Chinese rural economy in order to gain a better understanding of the current development of China.

Based on original data obtained from a purpose-designed nationwide household sample survey, the volume contains studies of the overall distribution of income, inequality and poverty in rural areas, wage employment in rural industries, urban wage inequalities, and the relationship between education and income. An appendix describes the household sample survey.

A considerable literature exists on the measurement of income inequality in China and its increasing trend. Much less is known about the driving forces of this trend and their quantitative contributions. Conventional decompositions, by factor components or by population subgroups, provide only limited information on the determinants of income inequality. This paper represents an early attempt to apply the regression-based decomposition framework to the study of inequality accounting in rural China, using household-level data. It is found that geography has been the dominant factor but is becoming less important in explaining total inequality. Capital input emerges as a most significant determinant of income inequality. Farming structure is more important than labor and other inputs in contributing to income inequality across households.