Who Promoted the Rural-Urban Inequality in Contemporary China?

Abstract

After 1949, China has witnessed dramatic economic growth especially in recent decade. Economists predict that Chinese economic growth rate will continue consistently in the next decades. The growth has fueled a remarkable increase in per capita income a decline in the poverty rate from 64% to 10% in 2004. However, income inequality increased sharply after the Economic Reform and Open Up era. This paper investigates the rural and urban economic inequalities in contemporary China by identifying various drivers behind these trends---including urbanization, quality education, governmental funding, and political policy. From sociocultural perspective, flaws on Hukou system disables rural population to have the same right as urban population in schooling, medical care, and career aspects; limited brand value disables rural population to start up strong enterprise; all factors have restricted chances for the relatively poor rural population to pursue higher living standard. Due to China has unique Hukou and Yibao system, poor villages couldn’t afford services including household, educational tuition, health care and so on. This analysis addresses case study of socioeconomic and sociopolitical issues related to economic inequality in contemporary China and indicates several ways to eradicate inequality and promote economic growth.