Soc 428: Contemporary China Lecture 12: Social Inequality in China

1. Soc 428: Contemporary China Lecture 12: Social Inequality in China Yu Xie The University of Michigan

2. Social Inequality • Social inequality is rated the number 1 social problem in our 2012 nation-wide CFPS survey. • What’s social inequality?

3. Social Inequality • Social inequality is rated the number 1 social problem in our 2012 nation-wide CFPS survey. • Social Inequality means that a social outcome is distributed unequally to members in a society. • Or, different members of a society have different amounts of a social outcome. • Deviation from the political process of democracy – one person, one vote.

4. Outcomes versus Social Groups • Social Outcomes: conditions or processes of social significance. Examples: income, education, residence, happiness, and health. • Social Groups: Aggregation of individuals by a common social and demographic attributes. Examples: gender, age, education, race, location, political affiliation.

5. Inequality in Different Social Outcomes • Examples: • Income inequality • Education inequality • Housing inequality • Health inequality

6. Inequality by Social Groups • Examples: • Inequality by race • Inequality by gender • Inequality by social origin • Inequality by education • Inequality by rural/urban residence

7. Today’s Focus • Inequality in income/earnings by …

8. How do We Measure Inequality? • Key idea of inequality: a small percentage of people get disproportionately large share of the goodies. • A common measure: Gini index (0-1).

9. Lorenz Curves Area = GiniIndex

10. Lorenz Curves Area = GiniIndex

11. Development and Inequality, UN Ratings.

12. Comparison of Trends: China and US

13. International Comparisons

14. Why did Inequality Rise? • Result of the post-reform political process, a reaction to the extreme form of egalitarianism and common poverty. • Eagerness to develop at whatever social cost. Inequality is seen as a necessary cost for development. • Vast spatial unevenness. • Danwei. • Reduction of social welfare to improve efficiency.

15. Three “Claims” • (1) Inequality in China has been largely mediated by collective agencies, such as locales and work units; • (2) Traditional Chinese political discourse promoted merit-based inequality, with merit being defined as improving the collective welfare for the masses; and • (3) Many Chinese people today regard inequality as an inevitable consequence of economic development.

16. Claim 1: Mediation by Collective Agencies • Region (including rural/urban divide) is perhaps the most important social determinant of earnings in contemporary China (Xie and Hannum 1996; Hauser and Xie 2005). • Work unit (danwei, 单位) remains one of the most important determinants of earnings and benefits (Xie and Wu 2008; Xie, Lai, and Wu forthcoming). • In general, much of China’s inequality is generated across collective entities.

18. Claim 2: Tradition in Merit-Based Inequality • Evidence for this claim is mainly historical. • Drawn from a collaborative project with Miranda Brown.

19. Ideological Justification by Confucius (孔子 551 BCE - 479 BCE) and Mencius (孟子, 372 – 289 BCE) • Excerpt 1 (Mencius, 孟子): “The people are of supreme importance; the altars to the gods of earth and grain come next; last comes the ruler.” • Excerpt 2 (Mencius, 孟子): “ If everyone must make everything he uses, the Empire will be led along the path of incessant toil. Hence it is said, ‘There are those who use their minds and there are those who use their muscles. The former rule; the latter are ruled. Those who rule are supported by those who are ruled.’ This is a principle accepted by the whole Empire.”

20. Ideological Justification by Confucius (孔子 551 BCE - 479 BCE) and Mencius (孟子, 372 – 289 BCE) • Excerpt 1 (Mencius, 孟子): “The people are of supreme importance; the altars to the gods of earth and grain come next; last comes the ruler.” • Excerpt 2 (Mencius, 孟子): “ If everyone must make everything he uses, the Empire will be led along the path of incessant toil. Hence it is said, ‘There are those who use their minds and there are those who use their muscles. The former rule; the latter are ruled. Those who rule are supported by those who are ruled.’ This is a principle accepted by the whole Empire.”

21. Ouyang Xiu（欧阳修1007～1072）was a well-known statesman/literatus in the Northern Song Dynasty. Ouyang’s father died when he was 4, and his mother raised him alone. Due to poverty, he could afford neither school nor supplies for learning. His mother taught the little boy herself, using a reed cane as a pen and writing in sand on the ground. (“画荻教子” )

22. Intelligent and diligent, Ouyang Xiu began self-study when he was ten. Through hard work, he passed the imperial exam to become a Jinshi (进士) and started his official career.

23. Ouyang Xiu was an “incorruptible,” “honest,” and “daring” official who held high positions such as military minister and justice minister. He oversaw and participated in the compilation of many important history books.

24. Results of a 2007 Survey in Gansu (n=633) • Now, think about your own economic well-being in general. Many factors account for one’s economic well-being. In your opinion, please rank the following five factors in terms of their relative importance （Which group of factors you would rate as “the most important,” which group you would rate as “the second most important,” etc.）

25. Claim 3: Inequality as a Byproduct of Development • Drawn from a collaborative project with Arland Thornton and other colleagues.

26. “Societal Projection” Hypothesis • Ordinary Chinese do not have much direct knowledge about other societies. • Chinese are able to accurately rate the level of development in most countries. • Their ratings of inequality in other countries are inaccurate, and derivative of their developmental ratings. • They project their own understanding between development and inequality onto other societies.

27. Data • A 2006 social survey in six provinces: Beijing, Hebei, Qinghai, Hubei, Sichuan, and Guangdong (n = 4,892).

28. Development Scale • Rating of 0-10 on development for • China • Japan • Brazil • United States • Pakistan

29. Inequality Scale • Rating of 0-10 on inequality for • China • Japan • Brazil • United States • Pakistan

30. Respondents’ Ratings of Five Countries on Levels of Development and Inequality, in Comparison to UN Ratings.

32. Main Response Patterns of Development Rating

33. Main Response Patterns of Inequality Rating by Response Patterns to Development Rating

34. Findings • (1)The respondents’ average ratings of development resemble those released by the United Nations, with those in Japan and Brazil underrated. • (2) The respondents’ ratings of inequality in the five countries are much less informed and accurate when compared to the United Nations’ measures.

35. Findings (continued) • (3) A significant portion of the respondents seem to have derived their ratings of inequality from their ratings of development, on the basis of their understanding of either a positive or a negative relationship between the two. • (4) The association tends to be positive, presumably reflecting Chin’s recent experience: Inequality rises as a byproduct of economic development.

36. Cautionary Conclusions • Inequality in China should be understood in its cultural, historical, economic, and political contexts. • At least in the foreseeable future, I do not think that inequality alone will lead to political and social unrest in Chinese society.