Poverty Reduction and the Income Inequality in China

In 2000, the United Nations adopted the Millennium Development Goals which set targets for raising living standards in low-income countries. The first goal was to “eradicate extreme poverty and hunger” (United Nations). The World Bank defines extreme poverty as income of less than $1.25 per day (World Bank, 2010a). Based on this definition, the World Bank estimates that the percentage of the population in China living in extreme poverty has fallen from 84 percent in 1981 to about 16 percent in 2005, a period during which China’s population grew by more than 300 million people (see Table 1 on last page). Because China is a very large country with a current population approaching 1.4 billion (more than four times the United States population), its dramatic reduction in poverty over the past 30 years has had a profound effect on global poverty measures. In fact, poverty reduction in China is the main reason that the incidence of extreme poverty in developing countries has fallen from about 52 percent in 1981 to 25 percent in 2005 (Table 1). While the absolute number of poor in China fell by some 627 million, the number of poor in other developing countries actually grew slightly (from 1,065 million to 1,166 million). These figures represent a decline in the percentage of the total population in poverty in other developing countries because of general population growth over that 25-year period (World Bank, 2010b).

Income inequality and elderly self-rated health in Sao Paulo, Brazil

Purpose: To test the association between income inequality and elderly self-rated health and to propose a pathway to explain the relationship. Methods: We analyzed a sample of 2143 older individuals (60 years of age and over) from 49 distritos of the Municipality of Sao Paulo, Brazil. Bayesian multilevel logistic models were performed with poor self-rated health as the outcome variable. Results: Income inequality (measured by the Gini coefficient) was found to be associated with poor self-rated health after controlling for age, sex, income and education (odds ratio, 1.19; 95% credible interval, 1.01-1.38). When the practice of physical exercise and homicide rate were added to the model, the Gini coefficient lost its statistical significance (P>.05). We fitted a structural equation model in which income inequality affects elderly health by a pathway mediated by violence and practice of physical exercise. Conclusions: The health of older individuals may be highly susceptible to the socioeconomic environment of residence, specifically to the local distribution of income. We propose that this association may be mediated by fear of violence and lack of physical activity. (C) 2012 Elsevier Inc. All rights reserved.

Propensity score matching approach to test the association of income inequality and mortality in Sao Paulo, Brazil

Background Support for the adverse effect of high income inequality on population health has come from studies that focus on larger areas, such as the US states, while studies at smaller geographical areas (eg, neighbourhoods) have found mixed results. Methods We used propensity score matching to examine the relationship between income inequality and mortality rates across 96 neighbourhoods (distritos) of the municipality of Sao Paulo, Brazil. Results Prior to matching, higher income inequality distritos (Gini >= 0.25) had slightly lower overall mortality rates (2.23 per 10 000, 95% CI -23.92 to 19.46) compared to lower income inequality areas (Gini <0.25). After propensity score matching, higher inequality was associated with a statistically significant higher mortality rate (41.58 per 10 000, 95% CI 8.85 to 73.3). Conclusion In Sao Paulo, the more egalitarian communities are among some of the poorest, with the worst health profiles. Propensity score matching was used to avoid inappropriate comparisons between the health status of unequal (but wealthy) neighbourhoods versus equal (but poor) neighbourhoods. Our methods suggest that, with proper accounting of heterogeneity between areas, income inequality is associated with worse population health in Sao Paulo.

A Swiss paradox? Higher income inequality of municipalities is associated with lower mortality in Switzerland.

It has long been surmised that income inequality within a society negatively affects public health. However, more recent studies suggest there is no association, especially when analyzing small areas. This study aimed to evaluate the effect of income inequality on mortality in Switzerland using the Gini index on municipality level. The study population included all individuals >30 years at the 2000 Swiss census (N = 4,689,545) living in 2,740 municipalities with 35.5 million person-years of follow-up and 456,211 deaths over follow-up. Cox proportional hazard regression models were adjusted for age, gender, marital status, nationality, urbanization, and language region. Results were reported as hazard ratios (HR) with 95 % confidence intervals. The mean Gini index across all municipalities was 0.377 (standard deviation 0.062, range 0.202-0.785). Larger cities, high-income municipalities and tourist areas had higher Gini indices. Higher income inequality was consistently associated with lower mortality risk, except for death from external causes. Adjusting for sex, marital status, nationality, urbanization and language region only slightly attenuated effects. In fully adjusted models, hazards of all-cause mortality by increasing Gini index quintile were HR = 0.99 (0.98-1.00), HR = 0.98 (0.97-0.99), HR = 0.95 (0.94-0.96), HR = 0.91 (0.90-0.92) compared to the lowest quintile. The relationship of income inequality with mortality in Switzerland is contradictory to what has been found in other developed high-income countries. Our results challenge current beliefs about the effect of income inequality on mortality on small area level. Further investigation is required to expose the underlying relationship between income inequality and population health.

Splitsville: A Study of Income Inequality and Political Polarization in the United States House of Representatives

The study compares a measure of income inequality with polarization scores of U.S. Representatives from the 104th to the 109th Congresses. It attempts to explain the link, on the abstract level, between high inequality and high polarization. The end findings indicate that inequality increases a Representative's likelihood to act liberally.

Income Inequality in the 1990s: Re-Forging a Lost Relationship?

Using data from March Current Population Surveys we find gains from economic growth over the 1990s business cycle (1989-2000) were more equitably distributed than over the 1980s business cycle (1979-1989) using summary inequality measures as well as kernel density estimations. The entire distribution of household size-adjusted income moved upwards in the 1990s with profound improvements for African Americans, single mothers and those living in households receiving welfare. Most gains occurred over the growth period 1993-2000. Improvements in average income and income inequity over the latter period are reminiscent of gains seen in the first three decades after World War II.

Economic Reforms and Income Inequality in Urban China

This paper reports the results of an analysis of changes in income inequality, and in its determinants, in urban China since the economic reforms that began in 1978. The intention is to identify new characteristics of economic inequality. It first shows that income differentials acrossand in provinces widened and that their economic rankings were becoming fixed during the period from 1988 to 1995. Second, age was the major factor in inequality in 1988, while education became the important factor in 1995. Third, education significantly contributed to increasing inequality during the period. Fourth, the higher education-level groups had less within-group inequality. These changes reflect the penetration of the market mechanism into China after the reforms. However, this will be problematic without equality of opportunity.

Factor decomposition of income inequality change : Japan's regional income disparity from 1955 to 1998

We propose a method for the decomposition of inequality changes based on panel data regression. The method is an efficient way to quantify the contributions of variables to changes of the Theil T index while satisfying the property of uniform addition. We illustrate the method using prefectural data from Japan for the period 1955 to 1998. Japan experienced a diminishing of regional income disparity during the years of high economic growth from 1955 to 1973. After estimating production functions using panel data for prefectures in Japan, we apply the new decomposition approach to identify each production factor’s contributions to the changes of per capita income inequality among prefectures. The decomposition results show that total factor productivity (residual) growth, population change (migration), and public capital stock growth contributed to the diminishing of per capita income disparity.