Growth with Inequality

The following sections are included:

• FOREWORD

• CONTENTS

• ACKNOWLEDGMENTS

• LIST OF CONTRIBUTORS

The following sections are included:

• Introduction

• Income Inequality in China
  • Urban–Rural Income Gap
  • Regional Disparities
  • Income Inequality of Residents
    • How Large is the Gini Coefficient?
    • How Serious is China's Inequality?

• China's Kuznets Curve

• Conclusions
  • Economic Implications
  • Political Risk

• References

The following sections are included:

• Introduction

• Hong Kong — An Economic Miracle with Unequal

• Why Hong Kong's Income Distribution is so Unequal?

• Why is Disposable Income Distribution so Unequal in Hong Kong?

• Summary

• References

The following sections are included:

• Introduction

• Components of LIMEW

• Trends in the Level and Composition of Well-being

• Economic Inequality

• Conclusion

• References

In this chapter, I investigate the question of whether class structure matters in understanding the increasing inequality in India during the period of economic liberalization. I argue in the paper that almost the entire increase in the overall Indian inequality during this period is explained by the rising inequality between classes rather than within them (unlike, for instance, in China, where the entire increase in inequality during the same period is explained by the increase in the within class inequality). There is now clear evidence from the National Sample Survey quinquennial household consumer expenditure surveys conducted in 1993–1994 and 2004–2005 that increased distance between urban elites (owners, managers, and professionals), rural rentier classes (such as moneylenders and absentee landlords) who are more stratified at the top, and unskilled urban workers, marginal farmers and agricultural workers, who are increasingly more stratified at the bottom helps us understand the distributional dynamics of the Indian growth story. Also, the urban sector is both becoming more unequal among its own classes while it is also getting more stratified vis-à-vis the rural classes. I analyze the class structures in India and decompose (using the methodology of Yitzhaki, 1994) the overall inequality into inter-class and intra-class terms. Finally, I explain these changes by analyzing the Indian policies during this period.

The following sections are included:

• Introduction

• Income Generation and Estimation Techniques

• Patterns in Germany and China

• Conclusion

• References

The following sections are included:

• Introduction

• Egalitarian Growth and Capital Controls in Korea

• Financial Opening, the Crisis and Neoliberal Restructuring

• Higher Inequality under Neoliberal Regime and its Problems

• Conclusions

• References

The following sections are included:

• Introduction

• Mapping the Consequences of Neo-liberalism
  • Inequality and the Slow Erosion of the Social Fabric

• The Party Political Dimension: Inequality and the 2010 General Election
  • The Conservatives — Remedying the “Broken Society” with the “Big Society”
  • Labour Party — “Enhancing Social Mobility”
  • The New Conservative-Liberal Coalition Government — “Fairness and the Decentralization of Power”

• Cornwall — Tackling Inequality at the Local Level
  • Housing Affordability
  • Developing a Multi-Agency Approach

• Concluding Remarks

• Acknowledgment

The following sections are included:

• Introduction

• Profile of the Poor Households

• Rates of Return to Education

• Probability of Selecting Employment in the Non-Agricultural Sectors

• Conclusion

• References

Income disparity has been and still is an important issue of debate in economic development. This is especially so in the fast growing economies, such as those in Asia. In spite of its importance, there are obstacles for analysis. The most difficult part is the measurement of disparity, caused by the lack of consistent and comprehensive data. This chapter takes the example of Thailand and tries to overcome these obstacles by using distributional statistics, specifically the gross provincial products data, and analyzes the relationship between income disparity and economic development. The comparison with Japan, using the same method is also shown.

While the strategy of openness had earned Singapore rapid economic growth, upward social mobility, and possibly decreasing inequality in the early years of development, the more recent years saw increasing inequality and with it an underlying possibly diminished upward intergenerational mobility due to skill-biased growth processes, skill-biased parental influence, liberalization in the education industry, and structural changes in the society which hurt the human capital accumulation of children in families under economic and intra-household stresses. In particular, the paternal influence on educational aspiration and attainment is more pronounced than the mother's. Non-Chinese and youths from disrupted families are worse off in both educational aspirations and educational attainment.

The following sections are included:

• Introduction

• Income Inequality and Household Education Expenditure
  • Long-term Trend of Income Disparity
  • Education Expenditure by Income Class
  • Quantitative Analysis on Education Expenditure

• Income Inequality and Education Effects
  • Evidence from FIES
  • Case Study on Tokyo University
  • Case Study on Compulsory Education in Tokyo

• Conclusion

• References

The following sections are included:

• Introduction

• Labor Market Development in China
  • Rural to Urban Migration
  • Urban Economic Restructuring and Informalization
  • Stricter Regulations

• Understanding the Inequality
  • The Impact of Migration
  • Impacts of Informality
  • The Impact of Social Policies

• The Changes of Labor Market on Inequality
  • Data Explanation
  • Measure the Labor Market Changes and Inequality
  • Regression Based Decompositions
  • Demographics
  • Human Capital
  • Informality
  • Sectoral Effects
  • Regional Factors

• Conclusions

• References

The following sections are included:

• Introduction

• Literature Review

• Data and Variables Description

• Estimating income Disparity by Education Background
  • Summary on income disparity
  • Calculation of the rate of returns to education

• Decomposing the Contributions of Education to Income Disparity
  • Methodology
  • Estimating the effect of education on income distribution

• Conclusion
  • Main findings
  • The intergenerational transfer effect of education
  • Policy implication — equalizing education
  • The China dilemma

• References

With the market-oriented reform of the housing system since the 1ate 1980s, the housing condition in urban China has improved significantly. On the other hand, it is widely believed that the introduction of market mechanisms has led to the rise of housing inequality among urban households. Based on panel data of the NBS survey (2004–2007), this paper examines recent trends in housing inequality in urban China and analyzes the influence of the market-oriented reform and traditional institutions. By measuring the Gini coefficient of two types of housing indicators, we find that in the period from 2004 to 2007 there exists a rising trend in housing inequality among urban households. However, the rise of inequality is not simply the result of the market-oriented reform. The results of the panel analysis show that, although household income and household head income have positive effects on the probability of owning a market-price (i.e., high price) house, the probability of owning a low-price house is heavily affected by some non-income factors including household member employment sectors and Hukou (registered residence status). As a whole, both income and non-income household characteristics have effects on the probability of home ownership as well as on the house size (house floor space). It means that the rising housing inequality in urban China should be regarded as the combined result of influence from ongoing market-oriented reforms and the persisting impact of some traditional systems.

The following sections are included:

• Introduction

• Model and Estimation Method

• Data and Empirical Results

• Conclusion

• References

The following sections are included:

• Introduction

• Hukou System Reforms and Labor Mobility

• Insufficient Statistics on Income in Covering Comparison Groups

• Decomposing Income Inequality Based on New Data

• Conclusion and Discussion

• References

The following sections are included:

• Introduction

• Recent Change in the Labor Market
  • Unemployment Rate
  • Real Wages and Wage Differentials

• Estimation of Agricultural Production Function and Surplus Labor
  • Agricultural Production Function
  • Agricultural Surplus Labor

• Factors for a Change in Agricultural Labor Force
  • Outflow of Agricultural Labor Force
  • Evaluation of Demographic Factors

• Conclusions and Their Significance
  • Conclusions
  • Income Distribution in the Transformation of the Labor Market

• References

The following sections are included:

• Introduction

• Understanding Inequality
  • The Dispersion of Household Labor and Market Income Differs Across Countries
  • Why are top earners getting a growing share of the cake?
  • Country Profiles Trace the Various Inequality Dimensions
  • Classifying Countries by their Inequality Patterns

• What Drives Inequality?
  • Technological Change and Globalization Partly Explain Recent Trends in Labor Income Inequality
  • Labor Income Inequality is Also Influenced by Structural Policies
  • Some Countries Rely Heavily on Taxes and Transfers to Influence Distributional Outcomes
  • Labor Income Tax Schedules have Become More Progressive but Tax Expenditures Hamper Redistribution

• Policy Trade-offs and Complementarities Between Growth and Income Equality Objectives
  • Growth-Enhancing Policy Reforms that are Likely to Reduce Income Inequality
    • Improving the Quality and Reach of Education
    • Promoting Equity in Education
    • Reducing the Gap Between Employment Protection on Temporary and Permanent Work
    • Increasing Spending on Active Labor Market Policies
    • Promoting the Integration of Immigrants
    • Improving Labor Market Outcomes of Women
    • Fighting Discrimination
    • Taxing in a Way that Allows Equitable Growth
  • Growth-Enhancing Policy Reforms that are Likely to Raise Income Inequality
    • Increasing the Flexibility of Wage Determination
    • Shifting the Tax Mix from Personal and Corporate Income Taxes Towards Real Estate and Consumption Taxes
  • Growth-Enhancing Policy Reforms that have an Ambiguous Effect on Income Inequality
    • Avoiding Too High and Long-Lasting Unemployment Benefits
    • Liberalizing Product Markets
    • Lowering Minimum Labor Costs
    • Moving from Income to Wealth or Inheritance Taxes

• Conclusions

• References

The following sections are included:

• INDEX

• ABOUT THE AUTHOR