New Politburo Standing Committee

Xi Jinping, General Secretary of CCP PRINCELING

Li Keqiang, Premier of State Council YOUTH LEAGUE

Zhang Dejiang, Head, NPC PRINCELING

Yu Zhengsheng, Head, CPPCC PRINCELING

Liu Yunshan, Head, CCP Propaganda YOUTH LEAGUE

Wang Qishan, Head, CCP Disc. Insp. PRINCELING

Zhang Gaoli, Exec V. Premier JIANG ZEMIN’S PROTEGE

China's Impact on Global Poverty, 1987-1998 World Bank's PPP$1/day consumption

poverty line

Change in global number of poor (%) = - 0.6

Excluding China = + 9.3

Acknowledgements

Data source Rural Education Action Project

Stanford University Prof. Scott Rozelle

3

Comparative Context

Hourly wages, 1990s (US$/hour) US $24 Japan $22 Korea $14 Brazil $4 Mexico $3 China $1

Headline: “China is Eating Mexico’s Lunch”Note: job competition among low-wage platforms

4

Comparative Context: Korea Hourly wages, 1990s (US$/hour)

US $24 Japan $22 Korea $14 1970/80s ~$1 Brazil $4 Mexico $3 China $1

Korea transformation from low-wage, labor-intensive jobs to higher-wage, higher-productivity, higher-tech jobs

5

Comparative Context: Korea Korea’s high school graduation rates by

1980s Urban

Close to 100% Rural

Close to 100%

6

Comparative Context: Mexico Hourly wages, 1990s (US$/hour)

US $24 Japan $22 Korea $14 Brazil $4 Mexico $3-4 1970s ~$1 China $1

Mexico low-wage, labor-intensive jobsBut where is the transformation?

7

Comparative Context: Mexico Mexico’s high school graduation rates by

1980s Urban

~80% Rural

~40%

8

Comparative Context

Inequality, Gini coefficients Korea 32

gap

Brazil 54 Mexico 52

9

Comparative Context: China Hourly wages, 1990s (US$/hour)

US $24 Japan $22 Korea $14 Brazil $4 Mexico $3 China $1

China Can China make the transformation from low-wage, labor-intensive jobs to higher-wage, higher-productivity, higher-tech jobs?

10

China’s Population: Urban, Rural, and Poor Rural

≈ 35% of school-aged children in poor rural areas

(> 50 million children, ages 6 to 15)

cities

other rural

Source: Scott Rozelle, REAP, Stanford

0

2000

4000

1978 1983 1988 1993 1998 2003

Year

Unskilled wage

≈ $2.00 / hour in 2010

Park and Cai, 2008;

Rozelle (REAP) 2012

Annual Real Hourly Wage (1978 dollars)

≈ 30 ¢ / hour in 1978

Starts rising 1998

Comparative Context: China China’s high school graduation rates by

1980s Urban

Close to ~85% Rural

Close to ~40%

China’s profile is more similar to Mexico’s than Korea’s

13

Comparative Context: China China’s middle school completion rates

Poor rural areas (35% of school-aged children) ~60%

14

Comparative Context: China Inequality, Gini coefficients

Korea 32 gap

Brazil 54 Mexico 52 China 50

15

Development policy areas

Education Other policy areas

Health Rural infrastructure

16

Development policy areas

Health As of 2000, ~80% of people in rural China

Without health insurance of any kind 2003 new Rural Cooperative Medical Scheme As of 2007, implemented in 86% of counties

Has not significantly reduced out-of-pockets expenditure

Has not significantly increased use of formal medical services

17

Development policy areas

Rural infrastructure Roads Drinking water

Poorest rural areas now receiving more inter-governmental fiscal transfers from above

Brandt

18

Development policy areas: InfrastructureIntergovernmental fiscal transfers to support rural tax/fee reform (equalizing)

80

245305

523

661

0100200300400500600700

2001年 2002年 2003年 2004年 2005年

农村税费改革转移支付

Comparative Context

Developmental challenges facing rural China Infrastructure Health Education

20

Questions for Discussion

Analyze Figure 3.1a. Do respondents perceive much inequality close to home?

Analyze Figure 3.2a. What are the 2 most important reasons respondents give for why people are poor? 2 least important reasons?

Analyze Figure 3.2b. What are the 2 most important reasons respondents give for why people are rich? 2 least important reasons?

What do Whyte’s findings suggest about the world view/ideology of survey respondents?

Do you agree with the majority of respondents in this survey?

Attitudes toward inequality

Attitudes toward inequality