From Equality of Deprivation to Disparity of Prosperity: The Poverty–Growth–Inequality Triangle in Post‐Reform China

18 Pages Posted: 15 Mar 2018

See all articles by Guanghua Wan

Guanghua Wan

Asian Development Bank Institute

Chen Wang

Shanghai University of Finance and Economics

Hua Yin

Shanghai University of Finance and Economics

Yan Zhang

Chongqing Technology and Business University

Date Written: March–April 2018

Abstract

In the post‐reform era, China achieved poverty reduction that was unprecedented in human history This poverty reduction was accompanied by fast growth and worsening income distribution. The present paper examines the poverty–growth–inequality triangle in China by: (i) providing growth, inequality and poverty profiles at the national and provincial levels; (ii) uncovering the contributions of growth and inequality changes to poverty reduction; and, finally, (iii) drawing lessons for other developing countries. Based on the World Bank's definition of the poverty line, China has already eliminated abject poverty, even though the poverty rate was as high as 88.3 percent in 1981. The remarkable record in poverty reduction is predominantly attributable to growth. The effect of inequality varied in different periods. In addition, the impact of growth on poverty reduction is found to be diminishing over time, a phenomenon worth further research and policy attention.

Keywords: China, income distribution, poverty‐growth‐inequality triangle

JEL Classification: O1, P25, R1

Suggested Citation

Wan, Guanghua and Wang, Chen and Yin, Hua and Zhang, Yan, From Equality of Deprivation to Disparity of Prosperity: The Poverty–Growth–Inequality Triangle in Post‐Reform China (March–April 2018). China & World Economy, Vol. 26, Issue 2, pp. 50-67, 2018, Available at SSRN: https://ssrn.com/abstract=3140850 or http://dx.doi.org/10.1111/cwe.12236

Guanghua Wan (Contact Author)

Asian Development Bank Institute ( email )

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

Chen Wang

Shanghai University of Finance and Economics ( email )

777 Guoding Road
Shanghai, AK Shanghai 200433
China

Hua Yin

Shanghai University of Finance and Economics

777 Guoding Road
Shanghai, AK 200433
China

Yan Zhang

Chongqing Technology and Business University

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