Regional economic performance in China1

This paper investigates convergence patterns among China's provinces using GDP data for the period 1952–97. We analyze convergence behaviour on the basis of Markov chains proposed by Quah (1993 ) and the generalized entropy decomposition proposed by Shorrocks (1980, 1984 ). Both sets of results show similar evidence of convergence within the pre‐defined geo‐economic sub‐regions, but no evidence is found of convergence between the sub‐regions. This finding has important policy implications for regional economic development in China. JEL classification: C33, E20, O47.     

The effects of transition on the distribution of income in China

Using two large samples for 1988 and 1995 we decompose the Gini coefficient of household income according to type of income with the purpose of analyzing reasons for the rapid increase of inequality. The results show that the change in relative size of money income and its changed profile are found to be the major processes behind the rapid increase of income inequality in rural China. Changes in housing allocation and an increased number of retirees in combination with higher benefits have made inequality increase in urban China and in China as a whole. JEL classification: D31, P27.     

China＇s Regional Disparity and Its Policy Responses

The fruits of China＇s rapid economic development over the 3 decades have not been distributed fairly across different regions. Using data from a sample of 815 Chinese listed firrns during 1998-2004, our error-correction investment model showes evidence of different financial constraints on firms＇ investment in different regions. We argue that China＇s regional development policies have contributed greatly to the regional inequalities. To control the rising inequality, China has shifted its focus from the coast to the interior regions. However, it is becoming increasingly difficult for the government to direct the economy, as market mechanisms now have afar greater influence on the economy than the government does. The people-centered approach of the current leadership has meant that substantial attention has been placed on regional development disparities in an attempt to build a ＂harmonious society. ＂ China needs further extensive reforms if all the measures for reducing regional disparity are to be effective.     

China's regional income disparityAn alternative way to think of the sources and causes1

Using data on China's provincial economies for the period 1978–2005, we decomposed the causes and factors that have contributed to inter‐regional per capita income disparity. Variance in capital per employee and variance in capital elasticity are found to be the two main sources of income disparity while the employment–labour force ratio is shown to be an important factor in containing the rise of income disparity. An analysis on inter‐regional factor reallocation effects reveals their relatively small and insignificant contributions to overall growth performance. It is also discovered that capital has in most years flowed in the right direction to pursue higher marginal productivity across provincial economies. Inter‐provincial labour movement, on the other hand, had not displayed significant equilibrating effects until institutional reforms started to allow freer inter‐regional labour mobility in later years. Generally, we conclude that market‐oriented factor mobility has played a crucial role in equalizing factor returns as well as enhancing growth efficiency across regions.     

A new continuous distribution and two new families of distributions based on the exponential

Recent work on social status led to derivation of a new continuous distribution based on the exponential. The new variate, termed the ring(2)-exponential, in turn leads to derivation of two closely related new families of continuous distributions, the mirror-exponential and the ring-exponential. Both the standard exponential and the ring(2)-exponential are special cases of both the new families. In this paper, we first focus on the ring(2)-exponential, describing its derivation and examining its properties, and next introduce the two new families, describing their derivation and initiating exploration of their properties. The mirror-exponential arises naturally in the study of status; the ring-exponential arises from the mathematical structure of the ring(2)-exponential. Both have the potential for broad application in diverse contexts across science and engineering. Within sociobehavioral contexts, the new mirror-exponential may have application to the problem of approximating the form and inequality of the wage distribution.     

Human–capital investment and the wage gap

Summary. According to empirical studies, the wage differential by skills evolved non–monotonically in the past decades although the relative supply of skilled labor steadily increased. The present paper provides a theoretical explanation for this finding. In our setting, technological change intertemporally alters the human–capital investment incentives of heterogeneous individuals. As a consequence of changing incentives, the time path of the relative wage is U–shaped while there is a rise in the share of skilled workers. Received: November 28, 2000; revised version: January 30, 2001     

城乡居民收入差距的动态演变:1988～2002年

中国城乡居民收入差距已经引起广泛关注。文章以住户调查数据为基础,利用泰尔指数分解、G.Fields分解、Blinder分解、分位回归分解等多种方法讨论了1988年、1995年和2002年“城乡”因素本身对城乡居民收入差距的贡献。这些分解结果表明我国的城乡差距较显著并在不断扩大;而且城乡差距更不利于农村中的低收入人群。     

Inequality, Crime and Economic Growth. A Classical Argument for Distributional Equality

This paper studies the dynamic general-equilibrium interactions between inequality, crime and economic growth by embedding the rational choice-theoretical approach to criminal behavior in a heterogeneous-agents endogenous-growth OLG model. Based on their respective opportunity costs, individuals choose to specialize in either legal or criminal activities. While legal households contribute to aggregate goods supply over time by either working or building human capital, criminals make a living by expropriating legal citizens of part of the latter's income. An increase in inequality lowers the economy's growth rate and possesses negative welfare effects for all agents with endowments equal to or above average and for agents with endowment below average that are born sufficiently far in the future.     

Twenty Years of Expenditure Inequality in Indonesia, 1993–2013

In this article, we consider the recent increase in inequality in Indonesia. We make new, consistent estimates of expenditure inequality for 1993–2013, using several measures that draw on household expenditure data from the National Socioeconomic Survey (Susenas) for 1993–2013. In doing so, we note that the central statistics agency, Badan Pusat Statistik (BPS), used grouped data for its estimates of inequality until 2009 and that this underestimated inequality up to then. Thus the rise in inequality reported since 2009 actually has a longer history. We argue that Indonesia experienced divergence and convergence at the same time: the magnitude of the rise in inequality was significant (divergence), but the rise was greatest in provinces or districts with low initial levels of inequality (convergence). We consider the literature on drivers of changes in inequality and identify a set of hypotheses, with an empirical basis, which we introduce as potential Indonesian-specific drivers of rising inequality for future exploration.