Fifty Years of Regional Inequality in China: A Journey Through Revolution, Reform and Openness

40 Pages Posted: 7 Aug 2001

See all articles by Ravi Kanbur

Ravi Kanbur

Cornell University; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Xiaobo Zhang

International Food Policy Research Institute (IFPRI)

Date Written: July 2001

Abstract

This Paper constructs and analyses a long run time series for regional inequality in China from the Communist Revolution to the present. There have been three peaks of inequality in the last fifty years, coinciding with the Great Famine of the late 1950s, the Cultural Revolution of the late 1960s and the 1970s, and finally the period of openness and global integration in the late 1990s. Regional inequality in China in 1999 exceeds the level experienced at its peak in the Cultural Revolution, and is near the peak level of inequality experienced during the Great Famine. Econometric analysis establishes that regional inequality is explained in the different phases by three key variables - the ratio of heavy industry to gross output value, the degree of centralization, and the degree of openness. Inequality has increased alongside spectacular performance in growth and poverty reduction. As China enters the WTO, pro-active measures encouraging liberalisation and investment in the inland regions may be required to promote more equitable growth in the future.

Keywords: Inequality, polarization, decentralization, industrialization, openness, chinese economy

JEL Classification: D63, O18, P27

Suggested Citation

Kanbur, Ravi and Zhang, Xiaobo, Fifty Years of Regional Inequality in China: A Journey Through Revolution, Reform and Openness (July 2001). CEPR Discussion Paper No. 2887. Available at SSRN: https://ssrn.com/abstract=278564

Ravi Kanbur (Contact Author)

Cornell University ( email )

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HOME PAGE: http://www.kanbur.dyson.cornell.edu

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
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Germany

Xiaobo Zhang

International Food Policy Research Institute (IFPRI) ( email )

2033 K Street, NW
Washington, DC 20006
United States
202-862-5677 (Phone)
202-467-4439 (Fax)

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