Accounting for Urban China's Rising Income Inequality: The Roles of Labor Market, Human Capital, and Marriage Market Factors

19 Pages Posted: 27 Feb 2019

See all articles by Shuaizhang Feng

Shuaizhang Feng

Shanghai University of Finance and Economics - Department of Economics; Princeton University; IZA Institute of Labor Economics

Gaojie Tang

Shanghai University of Finance and Economics

Date Written: April 2019

Abstract

This paper analyzes China's rising family income inequality since the early 1990s when the urban labor market started its transformation from a centrally controlled to a market‐driven one. We document the trends in income inequality over the period of 1992–2009 using the Urban Household Survey data, and adopt the approach recently proposed by Eika et al. (2014) to decompose changes in income inequality. We find that labor market factors accounted for about three‐quarters of the overall increases in income inequality while falling marriage rate contributed the other quarter. Changes in human capital levels and marital assortativeness have not contributed to the rising inequality.

JEL Classification: D31, I26, J12

Suggested Citation

Feng, Shuaizhang and Tang, Gaojie, Accounting for Urban China's Rising Income Inequality: The Roles of Labor Market, Human Capital, and Marriage Market Factors (April 2019). Economic Inquiry, Vol. 57, Issue 2, pp. 997-1015, 2019, Available at SSRN: https://ssrn.com/abstract=3342656 or http://dx.doi.org/10.1111/ecin.12748

Shuaizhang Feng (Contact Author)

Shanghai University of Finance and Economics - Department of Economics ( email )

777 Guoding Road
Shanghai, AK Shanghai 200433
China

Princeton University

22 Chambers Street
Princeton, NJ 08544-0708
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Gaojie Tang

Shanghai University of Finance and Economics

777 Guoding Road
Shanghai, AK 200433
China

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
0
Abstract Views
120
PlumX Metrics