UnderstandingInequalityinChina

YuXie

UniversityofMichigan

Author:YuXie,InstituteforSocialResearch(ISR),UniversityofMichigan,PekingUniversity.Email:yuxie@umich.edu.ThepaperisbasedonhisinaugurallectureforhisOtisDudleyDuncanDistinguishedUniversityProfessorshipattheUniversityofMichiganonApril1,2009.MirandaBrown,SiweiCheng,CindyGlovinsky,JingweiHu,NanHu,GuoyingHuang,QingLai,ZhengMu,ShaNi,LiguoPeng,XiSong,TaoTao,XiweiWu,andJiaYu,providedassistancewiththeresearch.ThearticlewasoriginallypublishedinChinese,withupdateddata.Thereferencefortheoriginalarticleis:

Xie,Yu.2010.“UnderstandingInequalityinChina(认识中国的不平等)”(inChinese).Society《社会》30(3):1‐20.

Inequality, Page 2 

UNDERSTANDINGINEQUALITYINCHINAAbstract:Drawingonpastresearch,theauthorhassetforththefollowingpropositions:(1)

inequalityinChinahasbeenseverelyimpactedbycertaincollectivemechanisms,suchas

regionsandworkunits;(2)traditionalChinesepoliticalideologyhaspromotedmerit‐based

inequality,withmeritbeingperceivedasfunctionalinimprovingthecollectivewelfarefor

themasses;and(3)manyChinesepeopletodayregardinequalityasaninevitable

consequenceofeconomicdevelopment.Thus,itseemsunlikelythatsocialinequalityalone

wouldleadtopoliticalandsocialunrestintoday’sChina.

Keywords:attitude/ideology,China,economicdevelopment,inequality

Inequality, Page 3 

UNDERSTANDINGINEQUALITYINCHINA

Ⅰ.Introduction

Thetitleofthispaperrequiresabriefclarification.Theword“understanding”means

specificallyascholarlyinquiryforknowledge,whichisanendinitself.Thispaperiswritten

freeofvaluejudgment,anditisnotmyintentiontocounseltheChinesegovernmentorthe

civilaudienceontheissueofinequality.Inequality,inthispaper,isapproachedasan

empiricalphenomenonratherthanasasocialproblem.Inotherwords,inthesepagesmy

intentiondoesnotgobeyondapurelyintellectual,apoliticalunderstandingofinequalityin

China.

Chinatodayisundergoingadramaticsocialtransformationcomparabletothe

RenaissanceinearlyEuropeortheIndustrialRevolutionin18th‐19thcenturyBritain.

Involvingthelargestpopulationintheworldtoday,thesocialchangeshavebeen

unprecedentedlyextensiveinscaleandfar‐reachingintheirconsequences.Atan

astoundinglyrapidrate,manyfundamentalaspectsofChinesesocietyhavebeenchanged

irreversibly.Asscholars,socialscientistsarefortunatetoworkincontemporarytimesand

havetheopportunitytoobserve,document,analyze,andunderstandtheseongoingsocial

changesinChina.

ThegreatChinesesocialtransformationcanbesummarizedunderfouraspects:(1)

Economicdevelopment.Thenationaleconomyhasnotonlyexperiencedrapidexpansionin

volume(seebelowfordata),butisalsoundergoinganinstitutionalshiftfromcentral

planningtoamarketeconomy.(2)Socialchanges.Forexample,manysocialistsocial

arrangements,suchasstate/danwei‐controlledassignmentofjobsandhousinginurban

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China,arenolongerexperiencedbymosturbanresidentstoday.(3)Demographic

transition.Althoughithasattractedonlylimitedattentioninsocialscience,China’s

demographictransitioninrecentdecadescreatedanimportantconditionforthecountry’s

phenomenaleconomicgrowth.Therapiddeclineinmortalitysincethe1950sandthedrop

infertilitysincethelate1970shavehadfar‐reachingconsequencesforthenation.(4)

Culturalchanges.Throughglobalcontact,theWesternwayoflifehasgainedincreasingly

moregroundinChina,whereasChinesetraditionshavecontinuedtowaneovertime.This,

combinedwithvaryingsub‐culturesindifferentsocialgroups,hasproducedrichcultural

dynamicsincontemporaryChina.AllofthesechangeshavegreatlyinfluencedChinese

people’sdailylivesandwork.Thus,economicinequality,anotheraspectofChina’smajor

socialtransformation,hasbeenevolvingagainstthebackdropofthesebroaderchanges.

Anexaminationofdatarevealscleartrendsforbotheconomicgrowthandrising

inequalityinChinaoverrecentdecades.First,Chineseeconomicoutputboomedsincethe

1980s,withanannualizedgrowthrateforper‐capitaGDP,netofinflation,at6.7%peryear

between1978and2008(Figure1).Suchmassive,sustained,andrapideconomic

developmentwasneverseenbeforeinworldhistory.Itovershadowsthegoldenyearsof

theAmericaneconomybetween1860and1930,whentheannualgrowthratewas4%

(MeasuringWorth2009).Whileunfoldingmorerapidly,today’sChineseeconomic

expansionhasalsooccurredonamuchlargerscale.Atthesametime,inequalityhasalso

beenontherise.ThemeasurementofeconomicinequalityinChinaisrathercontroversial

inacademia.Thereareconcernsaboutdataauthenticity,reliability,andcomparabilitywith

othercountries.WhetherornottheGinicoefficientprovidesvalidassessmentofinequality

isalsosubjecttodebate,butitremainsthemostfrequentlyusedindicator(Wu2009).The

GinicoefficientsinFigure2werecomputedusingofficialdatareleasedbytheChinese

government(Han2004).Evenso,arisingtrendisclearlyshown.Infact,nomatterwhat

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dataandmeasuresoneuses,thedramaticincreaseininequalityoverthisperiodis

indisputable.

Figure1aboutHere

Figure2aboutHere

Thekeyquestionis,Howcanweunderstandtheemerginginequalityincontemporary

China?Someobserversinjournalismarguethateconomicinequalitywillleadtopolitical

andsocialinstabilityinChina.Thispossibilityhasraisedpopularconcernsduetothe

seriousnessoftheconsequencesimplied(SeeWu2009foradetaileddiscussion).

Inmyview,thereisnosimpleanswertoourquestion,whichisusefulonlyinthatit

underliesanextensiveresearchagenda.Aboveall,Ibelieveweshouldnotandcannotstudy

inequalityintotalisolationfromotheraspectsinChinesesociety.Unlikeinexperimental

sciences,wheretheaimofresearchisoftentoisolateconfoundingandcontextualeffects,

wemusttrytounderstandChina’sinequalityinperspective—thatis,withinthecontextof

thecountry’shistory,culture,politics,andeconomy.Withsomuchtobeempirically

assessed,mycurrentunderstandingoftheinequalityinChinaisfarfromimpeccable.YetI

daretoadvanceseveraltentativepropositions.

First,China’sinequalitytoagreatextentisattributabletocollectiveagenciessuchas

geographiclocations,householdregistration(hukou),workunits,socialnetworks,villages,

kinshiplineages,families,etc.Inotherwords,muchoftheinequalityexistsnotatthe

individuallevelbutatthemeso‐collectivelevel.

Second,thetraditionalChinesepoliticalideologyendorsesmerit‐basedinequality.

Meritherereferstoadministrativeperformancethatismeasuredbythecollectivegood.

LeadersinChinesesocietyareoftenrewardedwithvariousbenefitsandprivilegesfor

Inequality, Page 6 

maximizingthepublicgood.Thatis,iftheprivilegesenjoyedbytheupperclassbringabout

desirableoutcomesfortheirsubjectsandothersinsociety,suchdifferentialtreatmentsare

acceptedandevenencouragedintheChinesemeritocratictradition.

Third,possiblyduetopropagandaandactualexperiencesinrecentyears,inequalityis

viewedbysomeChineseasanecessaryevilforthesakeofdevelopment.Thestate

propagandaorganhastakenpainsindrivinghometheideathateconomicdevelopment

requiressomepeopletogetrichsooner,andtheresultinginequalityisthepricethathasto

bepaid.Asofnow,manyChinesepeoplemaysubscribetothispointofview,holdingthat

inequalityisaninevitable,albeitundesirable,outcomeinacountry’seconomic

development.

Idonotbelievethattheabovethreepropositionshavebeenadequatelyverifiedby

empiricalevidence.Still,IwouldliketoconveyhowIcametogainpartialconfidencein

them.

2ThreepropositionsrelatingtoinequalityinChina

2.1CollectiveAgency

TounderstandinequalityinChina,weshouldtakeintoconsiderationthenational

conditionsandfeaturesofChina.However,weshouldnotoveremphasizedifferences

betweenChinaandothercountries.Overemphasizingandtotallydenyingsuchdifferences

wouldbewrongingoingtoextremes.Tobesure,Chinahasitsownuniquecharacteristics,

butmanyofthemareonlyquantitatively,ratherthanqualitatively,differentfromthoseof

othercountries.

First,inChina,thegovernmentplaysaprominentrole.Thisistrue,comparedtoother

countries,fromthecentraltothelocaladministrationlevels.Second,theinterestsof

businessenterprisesandthegovernmentareinalliance.Thatistosay,enterprises

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(business)andthegovernment(politics)sharemutualeconomicinterestsandmaintain

closerelationships.Thisisnottrueinmanyothercountries.Third,mulit‐layered

paternalismisalongandwell‐establishedChinesetradition.AmemberofChinesesocietyis

imbeddedinmultiplelayersofcollectivity..InancientGreece,citizenswereequalandwere

abletoparticipateinpoliticsdirectly,althoughnoteveryonewasacitizen,andtheirsociety

wassmall.Incontrast,duetothevastnessofthecountry,thesocietalroleofaChinese

citizenbeginsinarelativelysmalllocationordanwei,which,inturnisincludedinalarger

placeordanwei.AdministrationinChinaishierarchicalandnested,notdirectedat

individuals,whohavenoindependentrolesintheirsociety.Forexample,membershipand

title(e.g.,deanordirector)inadanweiisimportantinChinabecauseChinesesociety

emphasizescommonalitieswithinacollectiveunit.Amemberorleaderofadanweiisnotan

independentindividualwhoisfreefromthedanweitowhichhe/shebelongs.An

individual'spositioninsocietywouldnotberecognizedifthepersonbecameseparated

fromhisorherdanwei.Inthisrespect,therearesignificantdifferencesbetweenChinese

andwesternsocieties.Bytheterm“multiplelayers,”wethusmeanmanyhierarchicallayers.

Forexample,inpoliticssuchlayersincludefamilyandsocialnetwork,danwei,basic‐level

government,andlocalgovernment;inhighereducation,theyincludedepartment,college,

university,universityofdistinctrank(e.g.,“211”,“985”universities)andsoon.Theseareall

differentlayers.Inbrief,Chinesesocietyisstructuredonmultiplelevelsandnested

hierarchicallyfromthetopdown.

Thus,IdonotbelievethattheChineseeconomyissimplymovingtowardsamarket

economyor,morespecifically,anAmerican‐stylemarketeconomy.Itisnaïvetoassertthat

ChinaisjustanothercapitalistsocietyliketheU.S.,orthatevenifitisnotsuchasociety

today,itwillbecomeonetomorrow.IrejectthepredictionthatChinawillestablisha

completelycapitalisticeconomicandsocialsystembecauseasasociologistIhavediscerned

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somedistinctcharacteristicsofChinaintermsofsocialstructure,traditionalculture,and

mutualinterestrelationships.

My1996paperincollaborationwithHannumpointedoutthatinChina,themost

influentialfactorforearnedincomeisnotindividualattributes,butregionaldisparities.The

influenceofregioncanbeverysignificant(XieandHannum1996).Later,inanotherpaper

publishedin2005(HauserandXie2005),wediscoveredthattheinfluenceofregional

differencesondeterminantsofearningshadincreased.WuandTreiman’s(2004)research

showsthathouseholdregistration(hukou)statushadagreatinfluenceonpeople’ssocial

statuses;thatis,thereisalargedisparitybetweenruralandurbanhukouholders(Wuand

Treiman2004).Thesedifferencesbyregionorhukoustatuscannotbeattributedto

personalendeavorandability,sincetheyarestructuraldifferencesfromwhichan

individualhasdifficultybreakingaway.Inourrecentpaper(XieandWu2008),WuandI

discussedtheimportanceofdanweiincontemporaryChina.Webelievethateventoday

danweiisstillplayingasignificantroleinaffectingpersonalincome,prestige,welfare,and

socialnetwork.FengWang’srecentbook(Wang2008)alsosupportedthisperspective.

Notlongago,TheGuardianpublishedanarticle(Vidal2008)basedonastudy

conductedbytheUnitedNations,undertheheadline“WealthGapCreatingaSocialTime

Bomb.”AlthoughitdidnotdiscussChinaindepth,itreferredtothecountrytwice.The

articlefirstquotedresearchshowingthatBeijingisthemostegalitarianplaceintheworld,

butthenitclaimedthattherewassevereinequalityinChina.Whywouldthesetwo

contradictoryviewpointscoexistinthesamearticle?Actually,theyarenotcontradictory.

ThelevelofChina’sinequalityishigh,butamajorpartofitisinterregionalandintergroup

inequality,suchastheinequalitybetweenBeijingandothercitiesorbetweenthe

agriculturalpopulationandthenonagriculturalpopulation.Withinacity,forexample

Beijing,inequalityamongresidentsislowerthanthatinothermetropolisessuchasNew

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YorkorLondon,althoughitmaynotbethelowest,asclaimedinthearticle,intheworld.

Relativelyspeaking,manyothercitieshavehigherlevelsofinequality.Thus,thesetwo

seeminglycontradictiveviewpointstellusthatregionaldisparityaccountsforalargepart

ofinequalityinChina.

Basedonofficialstatistics,wecanillustratetheimportanceofgeographicregion.From

Figure3,wecanobservetheprominenceofregionalvariationinincome.Atthesametime,

thedisparitybetweenruralandurbanareasisalsolarge.Thedisparitiesshowninthis

statisticalgraphareinaccordancewiththepublic’sgeneralunderstanding:forexample,the

averagepercapitaincomeinGuangdongorShanghaiishigh,whilelowinwesternregion

suchasGansu;urbanpopulationsenjoyhigherincomesthantheirruralcounterparts.The

magnitudesofthesedisparitiesaregreaterinChinathaninothercountries(e.g.,theU.S.).

Figure3aboutHere

Similartoregion,workunit(danwei)isalsoasignificantcollectiveagencyproducing

andmaintaininginequality.Asiswidelyknown,beforetheeconomicreform,danwei

determinedalmosteveryaspectofanindividual'sexistence,includingdailylife,politicallife,

work,economiccondition,andsoon.Inthosedays,danwei(orlinong,i.e.,neighborhood)

wasresponsiblefordistributingnearlyalltherationcouponsforsuchthingsasmeat,grain,

sugar,film,bathing,bicycles,andsewingmachines.Besides,notonlywouldadanwei

approvemembers'marriages,italsoprovidedhousingforthem.Ifamarriagewasunhappy,

thedanweiwassupposedtointerveneandreconcilethecouple.Ifsomeonecausedtrouble,

otherswouldfirstreportittotheperson'sdanwei,etc.Someobserversarguethatafterthe

economicreformin1978thesituationmayhavechanged,thatthesystemofdanweimay

havebrokendown,ornolongerbeimportant.Inmyview,theseobservationsareincorrect

anddanweicontinuestobeessentialintoday’sChina.Forexample,whenundergraduate

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studentsfailtodealproperlywiththeirpersonalbusiness,administratorsoftheir

departments,colleges,oruniversitiesarestillheldresponsible.

In1999,weconductedasurveyinShanghai,WuhanandXi’an.Throughstatistical

analysesofthedata,wefoundthatdanweiisthesecondmajorfactorthatdetermines

people’sincomes,secondonlytothefactorofregionandcitylocationandoutdistancing

individualfactorssuchaseducationlevel,experience,gender,cadrestatus,andsoon(Xie

andWu2008)(seeTable1).InChina(especiallyincities),adanwei’sprofitabilityhasgreat

influenceonpersonalincomes(seeFigure4).Forexample,thereisincomeinequality

amonguniversityprofessors.Whydosomeofthemenjoyahighsalarywhileothersdonot?

Table1aboutHere

Figure4aboutHere

Toalargeextent,inequalityofprofessors’salariescanbeattributedtouniversities'

(danweis')salarypolicies,astheyaffectprofessors’personalincomesdirectly.If

measurable,oneprofessor’scontributionmaybethesameasanother’s,forexample

measuredbycoursestaughtorresearchconducted,buttheirsalariescouldbevery

different.Thatistosay,danweiexertalargeinfluenceonprofessors’incomes.Byextension

ofthislogic,itisnotdifficulttounderstandwhytheincomesofemployeesindifferent

danweiaredifferent,sometimesdramaticallydifferent,althoughtheyessentiallydothe

samework.Evenifwecontrolsomepersonalcharacteristicsbystatisticalmethods,for

exampleyearsofeducation,danweistillplaysacriticalroleindeterminingaworker’s

earnedincomeandeconomicwelfare.Inshort,danweiisanimportantfactorforinequality

andstratificationinChina.Danweicanactuallybeconsideredasasocialboundary

demarcatingpaymentschemes,whichvarybydanwei.Somedanweipossessmorefinancial

resourceswhileothersdonot.Althoughonemaystillthinkthatinequalityresultingfrom

Inequality, Page 11 

danweiisunfair,manyfindinequalitybydanweiacceptable.Becausethereisaboundary,

noteveryonecanbeamemberofacertaindanwei,soenteringagoodoneisacrucialstepin

attainingsocialstatus.

2.2TheTraditionofMerit‐basedInequality

AsfarasIcansee,inequalityhasbeenpartofChineseculturesinceancienttimes.This

argumentisbasedonmystudyofhistoricalmaterials.Theoreticalresearchaboutthisis

stillpreliminary(seeXieandBrown2011).Todiscussthis,Iwouldfirstputforwardseveral

importantcharacteristicsofancientChina.Thesecharacteristicsarenotmyownideasbut

ratherrepresentconsensusviewsamongwesternscholarsstudyingancientChina.HereI

merelysummarizethemtosuitmypurpose.

First,theChineseEmpirewasideallyunited,meaningthattherewasonlyoneemperor

throughouttheempire.Ofcourse,unification(大一统)wastheidealcondition,and

exceptionswerecommon,forexample,duringtheperiodoftheThreeKingdoms.Butideally,

therewasonlyoneemperorastheruler.Theideologyofunification(大一统)hasbeen

dominantinChina,whichisquitedifferentfromthewest.

Second,theChineseEmpirehadaverylargeterritoryandahugepopulation,sothat

thegreatproblemfacingtheEmpirewasadministration.Inanagewithoutautomobiles,

highways,trains,cellphones,internet,andothermoderncommunicationandtransportation

technology,itwouldtakeseveralmonthsforanofficialdocumentorletterfromthecentral

governmenttoreachalocalgovernment.Withmoderntransportationandcommunication

technology,itwasverydifficulttoconductefficientadministration.Thisproblemwasalso

trueinotherplaceshistorically.However,theadministrationoftheChineseEmpire–

somethingverydifficulttoaccomplish–was,ineffect,accomplished.Today,theU.S.isa

strongcountrywithalargeterritoryandahugepopulation.However,asiswellknown,the

U.S.wasdevelopedundermodernsocialconditions.TheU.S.enjoyeddramaticspeedof

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industrializationandmechanizationinthelate19thcenturyandbegantobuildrailwaysand

automobiles.Itsteppedintotheranksofthedevelopedcountriesinaroundthe1930s.

Goingthroughtwoworldwars,thefederalgovernmentoftheU.S.becamestrongerand

stronger,withmoreresourcesandpowerovertime.Yet,itwasextraordinary,andpuzzling,

thattheancientChineseEmpirewithaverylargeterritorycouldbegovernedforsomany

yearswithoutanyfundamentalchangetoitsbasicadministrativemodel.

Third,thebureaucraticsystemforChinesecivilofficialsisunique.Althoughthe

successionofdynastiesdependedonthemilitary,theadministrationoftheChineseEmpire

dependedonthecivilbureaucratsoveritslonghistory.Thisisdifferentfromotherancient

empires(e.g.,theRomanEmpire).InChinesehistory,scholarsorliteraticouldbecome

officials,andevenhigh‐levelones.Eventoday,Chinesepeopleexpecttheirchildrentostudy

hardsoastostartasuccessfulcareer.AConfuciansayingstates,“agoodscholarcan

becomeanofficial.”Thisisauniqueculturalproduct.Comparedwithothercountries,

Chinesebureaucracyhadanearlieroriginandgreaterscale.

Fourth,exceptfortheemperor,thearistocraticandprivilegedclasseswerenotstable.

Forexample,amongtheseigniorsoftheearlyQingDynasty,WuSangui,thePingxiSeignior

(平西王)hadnotremainedinpowerforonegenerationbeforehewasrepressedbythe

centralgovernment.Infact,theemperordidnotwanttheinheritanceofthearistocraticand

privilegedclass.Exceptfortheemperorhimself,noimportantofficialpositionswere

inheritedinChinesehistory.Incontrast,inmedievalEurope,officialpostscouldbepassed

onfromonegenerationtothenext.InEuropeanhistory,anaristocratictitlewasgenerally

passedontotheeldestson,sothatthefamilywouldmaintainwealthandpuissance.This,

however,wasnotthecaseinChina,forseveralreasons.First,exceptfortheemperor(and

veryfewotherposts),theofficialpositionswerenon‐inheritable.Second,therichusually

hadmanywivesorconcubinesandthusproducedmanysons,andthesonswouldthen

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dividethefamilywealthequally.Inthisway,nomatterhowpowerfulthefamilywas,their

wealthandpuissancewouldsoonbedividedup,andtherewasnotmuchleftfordirect

inheritanceafteraboutthreegenerations.Thatistosay,onecouldnotcountoninheritance

tobewealthyinChinesehistory(seeHo1954).Insteadofdirectinheritance,astandard

wayofpassingonfamilyadvantagewastoinvestinasmuchaspossibleinsonssothatthey

wouldbeabletomakemoneyinthefuture.Itdidnotevenmatterifayoungboyhadno

wealthyfather.Ifthefamilysupportedhisstudies,hecouldenterofficialdomandthenget

promotionandwealth.Therefore,intermsofculture,Chinesesocietyemphasizedsocial

mobility,andatleastsomelong‐rangesocialmobilitydidoccur(seeHo1964),whereasin

theWest,aristocratsandplebeianswereseparatedintodistinctcategories.Asaresult,from

theQinDynastyorevenearlier,fromtheWarringStatesonward,feudalismdisappeared.

Feudalismischaracterizedbyhereditabilityofsocialstatusandarigidsystemofpower

division,notsocialmobilityorcentralizedpower.

Fifth,inthepoliticalsystemofimperialChina,ideologyplayedanimportantrole.Since

theWesternHan,therehasnotbeenanyfundamentalchangeintheChinesepolitical

system,itscorebeingtheideologybasedonthedoctrinesofConfuciusandMencius.Ieven

seethepresent‐dayChinesegovernmentnowadaysascarryingonthetraditionofthe

ChineseEmpireinthelasttwomillenniums.Totakeitonestepfurther,thecurrentpolitical

systemincontemporaryChinais,tosomedegree,alegacyofthetwo‐thousand‐year‐old

Chineseculture.

MaxWeberwasaGermanwhohadneverbeentoChina,nordidheunderstandthe

Chineselanguage,buthewasanexcellentsociologistwithhisfamousbook,Economyand

Society(Weber,[1921]1978).HealsowroteabookontheChinesebureaucracy(Weber

1951).Althoughmainlybasedonsecond‐handmaterials,WeberanalyzedtheChinese

situationthoroughlyandthoughtfully(seeZhao2006).Inhisbooks,heraisedtwo

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questionsabouttraditionalbureaucracyinimperialChina.First,whileitseemsreasonable

toselectofficialsbyexams,whywerethecandidatestestedforknowledgeofimpractical

classicsratherthanadministrationskills,suchasaccountingormanagement?Weberdid

notunderstandwhythethingsbeingtestedwerenotdirectlyrelatedtotheworkofficials

weresupposedtoperform.Actuallythisisstillthecasenowadays.Appointmentsat

governmentpostsrequireacademicdegrees,anditisanadvantagetohaveadegreein

scienceorengineering,eventhoughpositionsrarelyrequireonetouse

scientific/engineeringknowledge.Insuchacase,anemphasisonmathematicaland

scientificabilitiesalsoseemsweird.ThisisWeber’sfirstquestion,andhethoughtitwasa

wastebecausetheknowledgetestedwasnotpractical.Hissecondquestionisthatthe

tenureinofficeofanappointedlocaladministratorwasbrief,say,forthreeyears.He

thoughtthispracticewasinefficient.Inordertowork,administratorsshouldlearnabout

thelocalsituationandcustomsandgetalongwellwiththelocalsubordinatesandthelocal

population.Justwhentheybecamefamiliarwiththeirsituations,however,theywere

transferredtoanotherplace.Therefore,WeberconcludedthattheChinesebureaucracywas

indeedinefficient.However,hedidnotunderstandthatefficiencywasnotthemost

importantobjectiveforaregimeordynasty.Inefficientasitwas,theempirestillbelonged

totheimperialfamily.Whatgoodwashighefficiencyiftheempirewasdisruptedandfell

intothehandsofothers?Fromthisperspective,IarguethattheancientChinese

bureaucracywassuccessfulbecauseitsolvedthebigproblemofadministration.Otherthan

thissystem,wecanhardlythinkoffanyothermethodsofgoverningsuchabigempire

underactualconditionsatthattime.

WhydidthegovernanceofChinarequirebureaucracy?Letussupposethatalocal

aristocratestablishedhispower.Howcouldtheemperorguaranteehisabsoluteobedience

tothecentralgovernment?Howcouldhemakethearistocratdispatchtroopsandhandin

Inequality, Page 15 

moneyduringwartime?Howcouldtheemperorensurehissubordinate'scollaborationin

infrastructureprojectssuchasdiggingacanalorbuildingthecitywall?Theemperorcould

onlyrelyonhisappointedadministratorstogotolocalplacesandgovern.Ofcourse,forthe

actualtaskofadministration,theadministratorsusedtheirowndiscretion,sincethe

emperorwastoofarawaytoreporttoandhadnoideaoftheactualsituations.Hence,the

situationalocaladministratorfacedinacentralizedempirewouldbesubstantiallydifferent

fromthatofanaristocratunderfeudalism.Ontheonehand,localadministratorswere

appointedandcontrolledbythecentralgovernment,andtheirfurtherpromotionwould

alsobedecidedbythecentralgovernment.Ontheotherhand,thelocaladministratorshad

toworkforthebestinterestsofthelocalpeopleinordertobepromoted(XieandBrown

2011).Chinesebureaucracywasausefulinnovationfortheancientemperorandwasan

importantmethodofmaintainingtheempire’sstability.Fromancienttimestothepresent

day,Chineseterritoryhasbeensovastthatmostemperorsrealizedthatitwouldbe

impossibletogovernbymilitarypower.Militarypowerwasseenasadouble‐edgedsword.

Withoutsufficientpower,themilitarycouldnotbeeffective.Withtoomuchpower,the

militarycouldrebel.Sotheemperorswererationalinrelyingonscholars,whomightbe

inefficientandpedantic,butnotrebellious,ratherthanonthedangerousmilitary.

HowwastheChineseEmpiregoverned?Itwasnotthroughtheuseofmilitarypower

butdoctrinesofConfuciusandMencius.ThedoctrinesofConfuciusandMenciuswere

indispensableadministrativetoolsforancientChineseemperors.Withoutthem,the

bureaucracywouldnotexist,andthelong‐termcentralizedempirewouldnotlastin

Chinesehistory.ItisinterestingthatthekeypointofConfuciusandMenciusdoctrinesis

benevolentgovernance(仁政).Thatistosay,thepersonbestowedwithpowershouldwork

forthepublicgood.Thisideologyattractspopularsupport.Forinstance,Menciusputit,

“Thepeopleareofsupremeimportance;thealtarstothegodsofearthandgraincomenext;

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lastcomestheruler”(Mencius,tr.Lau,p.68).Thispassageactuallyattributedtheultimate

purposeofimperialpowertotheservicetothepeople.However,Menciusbelievedthatin

ordertoservethepeople,inequalitywasjustified,“Itisanobjectiveandnaturalfactthatall

thingsaredifferentfromoneanother”(Mencius孟子:卷五滕文公上).Putinthewordsof

moderneconomics,somelevelofinequalityacrosspersonsisakindofcomplementary

relationshipthatbenefitseveryone,whileabsoluteequalitywillleadtowidespreadpoverty

oftheentiresociety.SoMenciussaid,“Ifeveryonemustmakeeverythingheuses,the

Empirewillbeledalongthepathofincessanttoil.Henceitissaid,‘Therearethosewhouse

theirmindsandtherearethosewhousetheirmuscles.Theformerrule;thelatterareruled.

Thosewhorulearesupportedbythosewhoareruled.’Thisisaprincipleacceptedbythe

wholeEmpire”(《孟子:卷五滕文公上》).Hearguedthatabsoluteequalityrequiring

everyonetodothefarmworkwouldnotworkandwouldtrapeveryoneintopoverty.There

aredifferencesamongpeople.Thosewhoaresmartshouldtakeupintellectualworkand

thosewhoarenotsmartbutstrongshouldparticipateinmanuallabor.Thisisthedivision

ofworkinsociety.InChina,manypeoplehaveheardandapprovedofthestatementthat

“Therearethosewhousetheirmindsandtherearethosewhousetheirmuscles.The

formerrule;thelatterareruled.”Thisstatementalsohelpsustounderstandinequality.In

Mencius’sview,capablepersonsshouldenjoytheirprivilegeandgovernothers,while

incapablepersonsshouldexerttheirphysicalstrengthanddosubordinateworkforothers.

Thisisacooperativerelationshipacceptedbyall,eventhepoor.

Whywouldthepooralsosupportinequality?Therearetworeasonsinthehistorical

contextofChina.First,asstatedabove,therichenjoyedtheprivilegeofactingonbehalfof

thepublic,includingthepoor.Asaresult,thepoorwerenotabsolutelosersinthis

arrangement,sincethedivisionoflaborbenefitedeveryone.Thisisanideologytermed

"paternalism,"whichisstillprevalentinChinatoday.Second,recallthatatleast

Inequality, Page 17 

theoreticallyspeaking,privilegeandwealthresultednotmerelyfromdestinybutfromthe

individual'sperformanceandabilities.Anincapablepersontodaymightbecomecapable

tomorrow,orhecouldraisehissontobecapable.Again,althoughhissonmightbe

incapable,hisgrandsoncouldberaisedtobecapable—therewasalwayssomehope.

Hence,Chinesecultureencouragedpeopletolookforward.Ratherthancomplainingabout

currentconditions,itisbettertolooktothefuture,notonlyone’sownfuture,butalsothat

ofthenextgeneration.Thatistosay,Chineseculturetendstopushpeopletochasetheir

futuredreamsattheexpenseofpresentinterestsandpleasures.Thisappealingidea

suggeststhatitdoesnotmatterifanindividual’scurrentconditionisnotidealbecausehe

orshecancountonthenextgeneration.Thisishowsocialmobilityworks,bringing

opportunitiestoeveryone.

Thereisapicture‐storybooktellingthestoriesofOuyangXiu.Suchstorybooksare

popularinChina,andmostofthemtellstoriesofsuccessfulcelebritiesinhistory.Teachers

andparentsnarratethesestoriestomotivatechildren:nomatterhowpoorapersonmaybe,

ifheisdiligent,hecangetanythingexcepttheimperialthrone.Aslongasthepersonstudies

well,hecanearnhighofficialtitles,justasOuyangXiubecametheMinisterofDefense(兵部

尚书).Moreover,theidealimageofascholargoesbeyondbeingmerelyagoodscholarto

beingagoodadministrator(“‘fatherandmother’ofthepeople”).Whydidthepublichave

suchexpectationsforadministrators?ThisisbecausetraditionalpoliticalideologyinChina

emphasizedbenevolentgovernance(i.e.,仁政).Weknowthatbecausethedecisionsof

administratorswererelativelyindependentandautonomous,itisunderstandablewhythe

selectioncriteriaofadministratorswerenotaboutadministrationormanagementskills,

butaboutvirtues.Yet,itwasnoteasytoknowwhetherapersonwasvirtuousornot.Many

methodsformeasuringanindividual’squalitieswereimplemented.Criteriaincluded

whetherhewasfilial,whetherherespectedhissuperiors,whetherheobeyedrules,andso

Inequality, Page 18 

on.DuringtheHanDynasty,“FilialandIncorrupt”(xiaolian)wastheprimarycriterionin

theRecommendationSystemofrecruitment 察举制,andwasconsideredthemost

fundamentalvirtueofhumansinConfucianism.TheAnalectssays,“Afilialandfraternal

personwillhardlyoffendthesuperior”(《论语:学而第一》).AftertheSuiDynasty,a

person'sknowledgeoftheclassicsbecamethemaincriterioninevaluatinghisvirtues.For

thosewhovaluedthiscriterion,familiaritywiththeclassicscouldrevealone’sbasic

qualities:intelligence,obedience,respectfortheteacher,self‐disciplineandsoon.Itis

similartotheemphasisonmathematicsandscientificknowledgeforappointmentsof

administratorsintoday’sChina.Althoughmathematicsandscientificknowledgearenot

reallyneededinadministrativeworkitself,personswhomaketheappointmentscanobtain

informationthroughacandidate’seducationinmathandscienceconcerningwhetherornot

thepersonisintelligent,obedient,hardworking,andaggressive.Itismoreatestofvirtues

andqualitiesthanofone'sknowledge.

Aswediscussedbefore,theChineseEmpirepossessedavastterritory,suchthatmost

appointedadministratorswereassignedtoplacesfarfromthecentralcapital.

Administratorsweregivenautonomousauthorityovertheregionstheygoverned.Forsuch

aposition,itwasaperson’svirtue,nothispracticalskills,thatdeterminedifhewasagood

administrator—“‘fatherandmother’ofthepeople.”Officials,especiallylocaladministrators,

accepteddualaccountability,beingbeholdentoboththesuperiorsandsubordinates.Their

workwas,toalargeextent,autonomous.Sincetheemperorwastoofarawaytocontrol

them,theadministratorscouldmakedecisionsbythemselvesandreportbackonlyafter

decision‐makingandimplementation.Whatgaveultimatelegitimacytotheimperialpower?

InfluencedbythedoctrinesofConfuciusandMencius,officialsbelieveditwastheMandate

ofHeaven.Thus,middle‐levelofficialsshouldassisttheemperorinrealizingthemandate.

Asaresultofbelievinginthemandate,theywereworkingforthelocalpopulation,i.e.to

Inequality, Page 19 

providefortheirmaterialneeds.Thus,itwasoftenrecordedinancientbooksthatmiddle‐

levelofficialssometimesdisobeyedtheirsuperiors’commandsbecausetheybelievedthey

shouldrespondtotheirhigherobligationasthe“‘fatherandmother’ofthepeople,”an

obligationinaccordancewiththeemperor’sMandateofHeaven.

Historically,officialsatandabovethecountylevelwereappointedbytheimperial

courtsothattheirpowercamefromthecentralgovernment.Yet,thedutyofacounty

administratorwasmainlytoservethelocalpopulation.Thiscreatesasituationforpotential

conflicts,whichcallforabalance.Executionofsuperiors’commandsmayincurarealcost

totheinterestofthelocalpopulation.Thus,middle‐levelofficialswerealwayscaughtinthis

situationofdualaccountability.Ibelievethisinevitablyresultedinthecommon

phenomenonofofficialsconcealingsometruthsfrombothfromtheirsuperiorsandtheir

subordinates.Administratorscannotdisclosecompleteinformationtoeitherside.This

phenomenonwasaconsequenceoftheChinesesocialstructure.Officialssometimescould

nottellthetruth,ortheywouldrisklosingtheirpositions.TheprimaryreasonfortheGreat

Famine(1959‐1961)wasthatthisbalancewasbroken—theofficialswereonlyresponsible

totheirsuperiors,nottotheirsubordinates.Themutually‐constrainedbureaucraticsystem

hadahistoryoftwothousandyearsinChina.Init,administratorsdidnothavemuch

freedom,astheyweresqueezedbytheirresponsibilitiestoboththeirsuperiorandtheir

subordinates.However,officialdomwasandstillis,attractivetomanypeopleinChina.

Unfortunately,theChinesebureaucraticstructuremakesitnecessarythatmanywell‐

meaningofficialslie.Howtosolvetheproblem?Superiorsknowthatsubordinateofficials

lie,sotheydesignmanyregulationsbywhichtosupervisesubordinates.However,

“wheneverthereisarule,thereisawaytogetaroundit.”Subordinatescontinuallyfind

waystoresistregulationandsupervision.Thecyclesofdeception‐regulationneverend,

Inequality, Page 20 

makingadministrativeproceduresmoreandmorecomplexandcumbersome,and

bureaucracyinefficient.

InthetraditionalChinesebureaucracy,animportantcriterionforevaluatingofficials

wastheirachievement‐‐howwelltheyassistedtheemperorinrealizingtheMandateof

Heaven.Toputitmoreconcretely,thecriterionwashowwellthelocalpopulationunder

theirgovernancelived.Thecentralgovernmentdidnotcareaboutwhatofficialsactually

didintheirpositions.Theofficialswereregardedasgoodaslongasthejurisdiction

governedwasprosperous,peaceful,andproblem‐free.Conversely,whenproblems

occurred,eventhoseduetonaturalcauses,officialsweretoblame,nomatterhowwellthey

performedorhowdiligentlytheyworked.Iftheconditionsweregood,peoplewouldpraise

theadministrator.Iftherewerenonaturaldisastersforyears,itwouldbecontributedto

Heaven’sappreciationfortheadministrator.Sothenotionofachievementwasimportant

eveninancienttimes.Theemphasisonanofficial’sachievementnowadaysisaresurgence

ofanoldpracticeintheChineseEmpire.

In2007,weconductedasurveyinGansu,animpoverishedandfarawayprovince.We

askedtherespondents:whatarethemostimportantfactorsthataffectyourowneconomic

wellbeing?Weprovidedthemwithfivechoices:centralgovernment,localgovernment,

danwei,familyandindividual(seeTable2).Althoughlivinginremoteareas,nearlyhalfof

theGansurespondentschosethecentralgovernmentastheirfirstchoice,meaningthatthey

believedthecentralgovernmentwasthemostimportantfactordeterminingtheireconomic

wellbeing.Thesecondmostimportantfactorgivenbytherespondentswasthelocal

government.Relativelyspeaking,personalfactorsweresecondarycomparedwith

governments.Thisillustratesthefactmentionedabovethatthepublicholdveryhigh

expectationsfortheofficialsandgovernmentsregardingtheirwellbeinginChineseculture.

Table2aboutHere

Inequality, Page 21 

Wementionedthatagoodadministrator,asthe“fatherandmother”ofthepeople,

sometimeswouldprotectlocalinterestsinsteadofyieldingtohissuperiors.Thenhowdid

thelocalpopulationencourageadministratorstobehaveinlocalinterests?Asweknow,

appointedadministratorswerenevernative,whichmeanttheyhadnointimate

relationshipsorkinshipwithlocalpeople.Aspecialmethodofencouraginglocal

accountabilitywasusedinancientChina:peopleerectedstelemonuments(andevenbuilt

templesandshrines)torecordofficials’contributions,suchasinitiatingtheconstructionof

roadsandbridges,defeatingbandits,andsoon.Intheeulogiesonsteleinscriptions,

administrators’achievementswerepraisedextravagantly.Peopleinthedistrictcouldsee

thesestelesbythewayside,beforeabridge,orwithinshrines.Officialswerealsohappyto

seethem.Steleswereerectednotonlyfordeadadministrators,butalsoforthosewhowere

alive.Asareflectionofpublicopinion,steleshelpedofficialstosecurepromotions(Xieand

Brown,2011).Inshort,althoughancientChinadidnotenjoydemocracy,localgroups

utilizedreputationalmechanismstoinfluenceadministratorstoservetheirinterests.Onthe

onehand,thissatisfiedadministrators’innerdesireforpromotion;ontheotherhand,it

motivatedthemtoconductthemselvesinwaysthatwouldbenefitthelocalpopulation.

2.3InequalityasaBy‐productofChineseEconomicDevelopment

Aroundthirtyyearsago,theChinesegovernmentpopularizedtheideathateconomic

growthmakesitnecessarythatasmallnumberofpeopleberichfirst.Ofcourse,such

propagandawasintendedtopersuadethepublictoacceptinequalityasacostofeconomic

development.Inmyview,alargenumberofChineseapproveoftheideathatinequalityisa

necessaryby‐productofChineseeconomicdevelopment.

Wefirstputforwardahypothesiscalled“SocietalProjection”(XieandWang2009).

Thepremiseofthishypothesisisthatthegeneralpublicdonotknowmuchaboutsocial

conditionsinothercountries,sincemosthavenevertraveledabroad,andeventhosewho

Inequality, Page 22 

havetraveledabroadhaveonlyhadacursoryglanceattheforeigncountriestheyvisited.

Tounderstandasocietyindepthisnoteasy,andordinaryChinesearenoexceptioninnot

knowingthelevelofinequalityandotherfeaturesofforeigncountries.However,theymay

haveroughideasaboutthedevelopmentallevelofthedifferentcountries,basedon

informationtransmittedthroughpopularmedia.Whenaskedaboutthelevelofinequality

inothercountries,theypresenttheirunderstanding,whichismostlysubjectiveimagination.

Inoursurvey,respondentscouldtellthelevelofdevelopmentwhenaskedaboutwhich

countrywasdevelopedandwhichonewasnot.However,whenaskedaboutthelevelof

inequality,althoughtheydonotknowtheactualanswers,theywouldmakeupanswers

basedontheirownimagination.

Thesedatacomefromoursurveyinsixprovinces(Beijing,Hebei,Qinghai,Hubei,

Sichuan,andGuangdong)in2006withnearly5000respondents(XieandWang2009).The

intervieweraskedtherespondenttoratethelevelofdevelopmentinfivecountriesusinga

scalefromzerototen:China,Japan,Brazil,UnitedStates,andPakistan,with10

representingthemostdevelopedand0representingtheleastdevelopedcountry.The

respondentswerealsoaskedtoratethelevelofinequalityforthesamefivecountriesona

0‐10scale,with10representingthemostunequaland0representingtheleastunequal

country.Actually,therehavebeenstatisticalindicatorsfromsocialscienceresearchthat

measurecomparativelevelsofdevelopmentandinequalityacrosscountries,whichare

reportedbytheUnitedNations(UN).Table3showsthecomparisonbetweenthestatistical

resultsfromoursurveyandtheobjectiveindicators.TheUNratingsofthelevelof

developmentareinthefirstcolumn,andtherespondents’averageratingsareinthesecond

one.OurrespondentsratedtheU.S.faraheadoftherest,withthescoreof9.19,andJapanis

thenext.Here,thestatisticalresultsofoursurveycloselyresembletheUNratings,except

foranunderestimationbyourrespondentsofthelevelofdevelopmentinJapan.However,

Inequality, Page 23 

therelativepatternholdstrue,withtheU.S.andJapanaheadofothercountries.Nextto

themareChinaandBrazil,andthesetwocountriesarecloseintheirratingsforboththe

respondents’ratingsandtheUNratings.AtthebottomisPakistan,whichisalsoin

accordancewiththeUNratings.Ofcourse,statisticalerrorisinevitableinsurveydata.

Table3aboutHere

BeforeIexplaintheratingresultsoninequalityfromthesurvey,letmedescribethe

actualconditionofinequalityinthesecountries.Amongthelargecountries,themost

unequaloneisBrazil,partlyduetoitslowlevelofeducationalattainment.Also,Brazilhas

aninternationalizedeconomy,soreturnstoeducationarehigh,whichincreasessocial

inequality.Inaddition,withitslargesize,Brazilsuffersfromregionaldisparity.Between

ChinaandtheU.S.,inequalityishigherintheformerthaninthelatter.Pakistanhasalow

levelofinequality,andJapanhasthelowestinequalityinthegroup.

How,then,didtherespondentsformtheirratingopinionsonthelevelofinequalityin

oursurvey?Ageneralanalysisofthesubjectiveratingsshowsthattherespondentsbelieved

thatinequalityishigherintheUnitedStatesthaninChina.Theyconsideredthelevelof

inequalityhighinJapanbutthelowestinPakistan(seeTable3).Itisworthnotingthatthe

respondentsratedthelevelofinequalityinBrazilaslow,whichcontradictstheratings

providedbytheUN.Asdescribedabove,therespondentswereabletoaccuratelyratethe

levelsofdevelopmentinthesecountries,buttheywerenotknowledgeableofthelevelsof

inequalityinthesecountries.Sotheirinequalityratingswereinconsistentwiththe

objectiveindicators.However,wecanaskwhytheseordinaryChineseratedinequalitythis

wayinfurtheranalysesofthedata.

Chinaisundergoingdramatictransformations,includingatransformationfrombeing

underdevelopedtobeingrelativelydevelopedeconomically,andfrombeingrelativelyequal

tobeingunequalinthedistributionofincome.Beforetheeconomicreform,peoplewere

Inequality, Page 24 

relativelypoorbutequal.Nowadays,asChinahasbecomemoredeveloped,inequalityhas

alsorisen.PerhapssomeChinesebelievethatthecurrentstatusoftheU.S.isChina’sfuture.

TheybelievethatatsuchahighlevelofinequalityChinaisonlyhalfwaythrough

development.IfChinaevercatchesupwiththeU.S.,itwillexperienceevenmoreinequality.

BecausetheU.S.ismoredevelopedthanChina,theybelievetheU.S.tobemoreunequal.We

alsoaskedinthesurveywhetherdevelopedcountrieshavehigherlevelsofinequalitythan

underdevelopedones,andmostoftherespondentsagreedthattheydo.

Wethenconductedastatisticalanalysisoftheresponsepatternstodevelopment

ratingsafterrank‐orderingthenumericalresponses,thatis,statingwhichcountryisthe

mostdeveloped,whichoneisthesecondmostdevelopedandsoon(seeTable4).Inthe

firstprevalentpattern,theU.S.isatthetop,followedbyJapan,Brazil,ChinaandPakistan.

34.11%oftherespondentschosethisresponsepattern.Thesecondpatternexchangedthe

ranksofBrazilandChinaandwaschosenby33.96%oftherespondents.Thethirdpattern

is,indescendingorder,Japan,theU.S.,Brazil,ChinaandPakistan,butonly2.18%ofthe

respondentschosethisone.Thefourthpatternissimilartopattern3butwiththeranksof

BrazilandChinaswitched.Ofalltherespondents,71.62%fallintothesefourpatterns.

Otherrank‐orderedcombinationsareirregularanduninterpretable,whichcanbeviewed

asmeasurementerrors.Withthesedata,wehopetoinvestigatetherelationshipbetween

theresponsepatternstoinequalityratingsandresponsepatternstodevelopmentratings

(seeTable5).Ouranalysisrevealsthattheyaresignificantlyassociated.Thereisapositive

correspondencebetweenresponsestotheinequalityscaleandthesameperson’sresponses

tothedevelopmentscale(seelines1‐4ofTable5).Thereisalsoanegativecorrespondence

patternshowingthatsomerespondents’inequalityratingscorrespondexactlytothe

oppositepatterntotheirdevelopmentratingsforthesamecountries.Forexample,if

respondentsrankedthedevelopmentlevelsasU.S.,Japan,Brazil,ChinaandPakistanfrom

Inequality, Page 25 

hightolow,theyrankedtheinequalitylevelsintheoppositedirectionasPakistan,China,

Brazil,JapanandtheU.S.fromhightolow(seelines6‐9ofTable5).

Table4aboutHere

Table5aboutHere

Inbrief,wediscoveredthattheChineserespondents’ratingsoflevelsofdevelopment

forthefivedifferentcountriescloselyresembledtheratingsgivenbytheUnitedNations

withaslightunderratingforJapanandBrazil,particularlyforJapan.However,the

respondents’ratingsofinequalitylevelsinthefivecountrieswerenotatallinaccordance

withtheinequalitystatisticsreportedbytheUN.Wefoundthatquiteanumberofthe

respondentsseemtohavederivedtheirratingsofinequalityfromtheirratingsof

development.Howdotheyviewtherelationshipbetweeneconomicdevelopmentandsocial

inequality?Someseeapositiverelationship,butothersseeanegativeone.InChina’sown

experienceinitsrecenthistory,developmentandinequalityhaverisentogether.Thatisto

say,increasesineconomicgrowthandsocialinequalityhavebeensimultaneous.Thus,the

prevalentopinionamongtherespondentswasapositivecorrelationbetweenthetwo.The

resultreflectstherecentexperienceofChinaandthegovernment’spropaganda.Thisresult

alsosupportstheargumentthat,tomanyChinese,inequalityisanecessarypricefor

economicdevelopment.

3Conclusion

Isetforththreepropositionsoropinionsinthispaper.Firstly,collectiveagenciesare

largelyaccountableforinequalityinChina.Duetotheexistenceofcollectiveagenciesasa

mechanismthatgeneratesinequality,theboundaryofinequalityisstructuralratherthan

personal.Also,thevisibilityofinequalityisdiminishedindailylife,whichhelpstolessen

socialresentmentinthegeneralpopulation.Second,intermsofideology,althoughthereis

astrongmoralimperativeforequalityinChina(Wu,2009),Chinesetraditionalcultureis

Inequality, Page 26 

actuallytolerantofinequality.Ofcourse,inmyview,people’sacceptanceofinequalityis

conditionalonthepropositionthatinequalityshouldbringwelfaretothegeneralpublic

andthatthereisthepossibilityforthemtomoveupinsocialstatusthroughindividual

efforts.InfluencedbyChinesetraditionalculture,manyChinesetodayfindinequality

acceptable.Third,someChinesebelievethateconomicgrowthitselfleadstoinequality:

sincedevelopmentiswhattheywant,inequalityisaninevitablebyproductofimproving

everyone’slivingcondition.Therefore,thoseunsatisfiedwithinequalitycanalsotolerate

inequalityinChinapassivelyandreluctantly.Basedonthesethreeconsiderations,I

conjecturethattheproblemofinequalityitselfalonewillnotcausesocialinstabilityforthe

nearfutureinChina.Thatistosay,althoughinequalityinChinaisincreasing,itsthreat

mightbeexaggerated.Inmyview,therearecertainmechanisms(e.g.politics,culture,

publicopinion,family,socialnetworkandsoon)moderatingsocialproblemscreatedby

inequality.Finally,itworthemphasizingthatmytentativeconclusionisfreefromany

politicalimplication.ItissimplymyunderstandingofinequalityinChina.

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Table1:PercentVarianceExplainedinLoggedEarnings

Viable DF R2 R2(1)City 2 17.47*** 19.12***EducationLevel 5 7.82*** 4.46***WorkingYears+WorkingYears2 2 0.23 0.05Gender 1 4.78*** 3.05***CadreStatus 1 3.08*** 0.63***WorkingSector 3 3.54*** 1.8***Profitabilityofdanwei(linear) 1 12.52*** 9.3***Profitabilityofdanwei(dummies) 4 12.89*** Notes:*p≤0.05;**p≤0.01;***p≤0.001.BasedonFtest.

R　 2(1)referstotheincrementalR2aftertheinclusionofDanwei'sfinancialsituation(linear).

Source:XieandWu(2008),basedonasurveyinShanghai,WuhanandXi’anin1999.

Inequality, Page 30 

Table2:AttitudesofResidentsinRemoteAreasonFactorsEffectingPersonalEconomicWelfareSituation(n=633)

First% Second%CentralGovernment 41.61 12.03

Local(City/County)Government 8.54 31.33DanweiorVillageCommittee 8.23 12.82FamilyFactors 21.33 18.8IndividualFactors 20.38 25.28Note:“Now,pleaseconsideryoureconomicwelfareconditioningeneral.Therearemany

factorsinfluencinganindividual’seconomicwelfare.Inyourviewpointandaccordingtoyourconsiderations,pleaserankthefollowingfivefactorsintermsoftheirimportance.(whichdoyouthinkisthe‘mostimportant’,whichdoyouthinkisthe‘secondimportant’andsoon.)”

Inequality, Page 31 

Table3:Respondents’RatingsofFiveCountriesonLevelsofDevelopmentandInequality,inComparisontoUNRatings.

Country UNRatingofDevelopment

(0‐1)

AverageRatingofDevelopment

(0‐10)

UNRatingofInequality(Gini,0‐1)

AverageRatingofInequality

(0‐10)China 0.768 5.56 0.447 6.25Japan 0.949 7.79 0.249 5.92Brazil 0.792 5.49 0.580 5.47U.S. 0.948 9.19 0.408 6.81Pakistan 0.539 3.80 0.306 5.07Source:XieandWang(2009).

Inequality, Page 32 

Table4:MainResponsePatternsofDevelopmentRating

Pattern

Number

DescriptionofRankingOrder Percentage Cumulative

Percentage

1 US≧Japan≧Brazil≧China≧Pakistan 34.11 34.11

2 US≧Japan≧China≧Brazil≧Pakistan 33.96 68.07

3 Japan≧US≧Brazil≧China≧Pakistan 2.18 70.25

4 Japan≧US≧China≧Brazil≧Pakistan 1.37 71.62

5 All116RemainingOtherCombinations 28.38 100.00

Source：XieandWang(2009).

Inequality, Page 33 

Table5:MainResponsePatternsofInequalityRatingbyResponsePatternstoDevelopmentRatingNo. InequalityResponsePattern ResponsePatterntoDevelopmentRating Total

Description 1 2 3 4 5

1 US≧Japan≧Brazil≧China≧Pakistan 25.58 8.32 6.67 3.03 8.42 14.13

2 US≧Japan≧China≧Brazil≧Pakistan 7.43 31.31 4.76 16.67 9.96 16.33

3 Japan≧US≧Brazil≧China≧Pakistan 0.43 0.67 8.57 3.03 0.29 0.69

4 Japan≧US≧China≧Brazil≧Pakistan 0.30 0.61 11.43 4.55 0.44 0.50

6 ReverseofPattern1 12.61 3.55 0.00 0.00 3.51 6.75

7 ReverseofPattern2 3.59 10.28 5.71 4.55 2.20 5.53

8 ReverseofPattern3 1.64 0.49 12.38 3.03 0.44 1.16

9 ReverseofPattern4 0.61 0.61 0.00 9.09 0.37 0.64

10 All112RemainingCombinations 47.81 44.16 50.48 56.06 74.38 54.28

Source:XieandWang(2009).

Inequality, Page 34 

Source: National Bureau of Statistics (2010a, 2010b). 

Note: Adjustment has been done for the data of 2005‐2008, on the basis of the 2nd Economic 

Census. 

0

5,000

10,000

15,000

20,000

25,000

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008

Per‐Capita GDP (RMB)

GDP(Billion, RMB)

Year

Figure1:TrendsinGDPandPer‐CapitaGDP,1952‐2008(in2008RMB)

GDP

Per‐Capita GDP

Inequality, Page 35 

Source: Han(2004).

00.050.1

0.150.2

0.250.3

0.350.4

0.450.5

1970 1980 1990 2000 2010Year

Figure 2: Trend in Gini Coefficient

Overall

Rural

Urban

Inequality, Page 36 

Source:ChinaStatisticalInformationNetwork(2011).

0

5000

10000

15000

20000

25000

30000

35000Shanghai

Beijing

Zhejiang

Guangdong

Tianjin

Jiangsu

Fujian

Shandong

Inner…

Liaoning

Chongqing

Guangxi

Hunan

Heb

eiYunnan

Hen

anHubei

Shanxi

Ningxia

Anhui

Jiangxi

Shaanxi

Jilin

Sichuan

Hainan

Tibet

Guizhou

Qinghai

Heilongjiang

Xinjiang

Gansu

Figure 3: Cross‐province Comparison of Per‐Capita Income Separately for Urban/Rural Residents, 2010 

per capita income of urban residents

（RMB）

per capita income of rural residents（

RMB）

Inequality, Page 37 

Figure 4: Earnings Differentials by Danwei Profitability

0

2000

4000

6000

8000

10000

12000

14000

Earnings

Very poor Relativelypoor

Average Fairly good Very good

Danwei Profitability

Observed

Observed Linear

Adjusted Linear