Poverty across China

3 Mar

When considering non-governmental figures such as  those produced by  the world bank, it can be observed that the gap between the richest in China, who are often situated in the urban areas and those who are poorest, who often live in the rural parts of China, has widened. This is in stark contrast to the rapid economic growth experienced in the country. It could be deemed that the sharp growth which was exclusively situated in certain urban provinces could be a factor heavily influencing the inequality gap. The government’s reforms under Mao were also a major factor that could be seen to have influenced the inequality, as they had an intrinsic focus on selected provinces which correlate to those that are most prosperous in the country of China today. ‘Government policies were also responsible for interregional inequality. In the early years of economic reforms, government policies were particularly favourable to the special economic zones and the open cities.’ (Yao et. al, 2004, p6161)

It could be argued that any kind of growth is good, and although there are some members unable to benefit from the growth hence the huge inequality gap, but the worrying issue is that there is a growing inequality among people living in the urban areas. Although poverty within China is predominately focused in rural areas, increasingly there has been an increase in inequality within urban areas due to rising unemployment and rural-to urban migration. (Yao et. al, 2004)

Naughton, Barry (2007). The Chinese Economy: transitions and growth, The MIT Press.

Chapter 9.1-9.3, pp. 209-221.

 

Ravallion, Martin, and Shaohua Chen (1999). When Economic Reform Is Faster Than

Statistical Reform: Measuring and Explaining Income Inequality in Rural China, Oxford

Bulletin of Economics and Statistics, 61 (February), pp. 75–102.

 

Yao, Shujie, Zongyi Zhang, and Lucia Hanmer (2004). Growing Inequality and Poverty

in China, China Economic Review, 15, pp. 145–63.

 

Park, Albert, and Sangui Wang (2001). China’s Poverty Statistics, China Economic

Review, 12, pp. 384–98.

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2 Responses to “Poverty across China”

  1. db7g09 March 4, 2013 at 7:50 pm #

    Statistics released by the national poverty alleviation authorities show government-sponsored efforts to help people out of poverty have made further progress. However, they should also be a reminder that non-economic measures are also needed if the country is to attain its goal of building a well-off society in an all-round way.

    According to the office that oversees national poverty alleviation and development, with the help of government-subsidized projects, 23.39 million people were pulled out of poverty in China’s rural areas in 2012, reducing the number of poor in the country by 10.2 percent to 98.99 million.

    This is undoubtedly an appreciable feat for a populous nation whose economic development is still very uneven. Especially as the government raised the poverty threshold to 2,300 yuan ($368) a year in November 2011, which resulted in the number of people judged to be living in poverty increasing to 128 million, nearly one-tenth of the country’s total population.

    The raising of the poverty threshold – bringing it closer to the international standard of $1.25 a day – reflected the government’s down-to-earth attitude toward poverty alleviation and its greater efforts to bridge the country’s widening wealth gap.

    However, all the talk of building a well-off society in an all-round way will ring hollow if tens of millions of people are struggling for subsistence in the country.

    Although most of the poor are concentrated in rural areas, moving to the cities does not guarantee that poverty will not follow them. China’s booming urbanization over the past decades has brought hundreds of millions of rural residents to cities, but a large number of them are still denied legal identities as urban residents.

    As these people are thus excluded from the welfare provision such as the minimum living allowance and healthcare subsidies that local authorities extend to urban residents, this group could easily become the urban poor when they should be benefiting more from urbanization.

    Artificial barriers have not only prevented migrant workers from integrating into the cities, they have also effectively hindered their pursuit of a better life and higher incomes.

    Removing these barriers and admitting rural workers into the urban welfare system will facilitate both a higher quality of urbanization and the nation’s poverty alleviation endeavors.

    Sources:

    Shujie Yao, Zongyi Zhang, Lucia Hanmer, ‘Growing inequality and poverty in China’ (2004) China Economic Review 15 (2004) 145 – 163.

    Simon Edge, ‘The shaming of a nation: China’s poverty finally acknowledged after children die in bin’ http://www.express.co.uk/news/world/360047/The-shaming-of-a-nation-China-s-poverty-finally-acknowledged-after-children-die-in-bin – November 23, 2012 (accessed 04/03/2013).

    ‘Rural poverty in China’ http://www.ruralpovertyportal.org/country/home/tags/china (accessed 04/03/2013).

    Damian Grammaticas, http://www.bbc.co.uk/news/world-asia-china-20165283 – 1 November 2012 (accessed 04/03/2013).

  2. st24g10 May 13, 2013 at 10:25 am #

    Agreeing with a comment previously made, regional inequalities still largely exist in China and remain extremely prevalent. Inequalities have reportedly risen in the past two decades, which contradicts the strategy of the market orientated reforms. This should ideally be facilitating all areas of the population, however, regional disparity remains. According to research, there are large gaps between the levels of income of those living in urban to rural settings. Additionally, the level of income varied between those who lived inland in a more central region, to those that lived in coastal district.

    Urban to rural ratio of income and consumption showed an abnormally high statistic between 2 and 3.5 (since the reform) in comparison to other countries globally. Per capita production and consumption showed that coastal areas were far richer and at a greater economic position than those seen in the interior provinces, therefore were more vulnerable during the reform period.

    Source: Yang, D, 2002, China Economic Review, What has caused regional inequality in China? Department of Economics, Virginia Polytechnic Institute and State University, Pamplin Hall 0316, Blacksburg, VA 24061, USA

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