China's Income Cleavage
One of the most notorious and obvious societal cleavages China currently faces is that of income cleavage. Though China has some of the largest and most well-developed cities in the world, including Beijing, Shanghai, and Chongqing, China is also home to a massive amount of poor, underprivileged migrant workers. This massive disparity is best demonstrated by the fact that China's enormous GDP - $8.2 million in 2012, the second largest in the world - is tiny when spread out over its enormous populace. China's GDP per capita is a sad $6,076 according to the International Monetary Fund's latest estimate, ranking it 86th among the countries of the world. The CIA World Factbook, meanwhile, places the GDP per capita around $9,300, ranking China 124th among states of the world. The low GDP per capita suggests a large income gap.
Though China's GDP demonstrated excellent growth since Deng XiaoPing's economic reforms in 1978, the income gap between the urban and the rural reached a peak as recent as 2009. At the time, the average disposable annual net income for urban households, about 17,175RMB, was over 3 times larger than the same for rural households - 5,153RMB. Today, the difference has not changed in any significant manner. As of 2012, the net income per capita 24,585RMB for urban residents and 7,917RMB for rural.
Interestingly, income equality has also been seen within urban and rural areas themselves. Urban areas feature serious wage inequality while rural areas see income from agriculture barely grow at all. These issues only exacerbate the problem of Chinese income inequality.
Regional wealth distributions also show a fair amount of disparity. China's richest provinces are focused toward the east, while the poorest are located toward the west. For instance, China's poorest province, Guizhou, has a GDP per capita of 16,000RMB while cities like Beijing, TianJin and Shanghai all have per capita GDPs over 80,000RMB.
Though China's GDP demonstrated excellent growth since Deng XiaoPing's economic reforms in 1978, the income gap between the urban and the rural reached a peak as recent as 2009. At the time, the average disposable annual net income for urban households, about 17,175RMB, was over 3 times larger than the same for rural households - 5,153RMB. Today, the difference has not changed in any significant manner. As of 2012, the net income per capita 24,585RMB for urban residents and 7,917RMB for rural.
Interestingly, income equality has also been seen within urban and rural areas themselves. Urban areas feature serious wage inequality while rural areas see income from agriculture barely grow at all. These issues only exacerbate the problem of Chinese income inequality.
Regional wealth distributions also show a fair amount of disparity. China's richest provinces are focused toward the east, while the poorest are located toward the west. For instance, China's poorest province, Guizhou, has a GDP per capita of 16,000RMB while cities like Beijing, TianJin and Shanghai all have per capita GDPs over 80,000RMB.
Historical Background
A simple cause is the historical disparity between the rich and poor areas. The richest parts of China, naturally urban parts of China, all were either culturally significant or geographically ideal. Beijing is the national capital. Shanghai is an important port and the open door to the west. Tianjin is located strategically near rivers and ports. Chongqing was the capital of the Republic of China. Guangzhou is located near the Pearl River and is close to Hong Kong. These cities have since attracted thousands of nearby workers, and due to Deng XiaoPing's Open Door policy, urban growth has been remarkable. Deng also stated at one point that some should be allowed to "get rich first" - an adage apparently still closely adhered to. People poured into the cities - foreigners and workers alike. Thus, almost 50% of all people in China live in urban areas, while rural provinces are left to rot. Though rural areas have seen growth in recent days, their growth simply can't compete with that of urban areas.
Recent History and EffortsPrevious president Hu Jintao (2002-2012) enacted a number of policies in an attempt to ease income gap. At the start of his term, Hu called for a more 'harmonious society' and noted income redistribution to be one of his primary goals for his tenure. Some of his proposed policies included:
Jiang Ze Min, president from 1993-2003, also attempted to deal with the issue of the income gap. He proposed an ambitious reform program titled "Develop the West." The program sought to stimulate development in poor Western provinces. This had limited success, though it (at the very least) encouraged infrastructural development in the target geographical areas. |
Graphs and Figures
Helpful Links:
- China Tries to Shut Income Gap - Wall Street Journal
- Experts call for wide-ranging reforms to tackle income inequality - China Daily
- Rising Income Inequality in China: A Price Worth Paying?
- brandeisear.wordpress.com/2012/11/20/443
- China Tries to Shut Income Gap - Wall Street Journal
- Experts call for wide-ranging reforms to tackle income inequality - China Daily
- Rising Income Inequality in China: A Price Worth Paying?
- brandeisear.wordpress.com/2012/11/20/443