Incentives and Motivation in China: The Reality of Rural Inequality.

by Charles Robert Roll, Jr.

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Discusses level of regional inequality in distribution of incomes produced in agricultural sector of China. The rules of agrarian reform are discussed to show that knowledge of these rules lead one to conclude that land reform did not change the level of regional inequality in per capita agricultural incomes measured at "hsiang" level, because the unit over which land was redistributed was the "hsiang." Estimates of per capita distribution of rural incomes after land reform are derived indicating that distribution of income appears to be more equal than in the 1930s. The distribution of per capita crop income was decomposed into within-region and between-region variances, suggesting that 75 percent of the variance could be attributed to regional income differences. The establishment of communes could be considered a second land reform. The recent demise of communes and decentralization to production teams suggest that rural regional inequality might be similar to rural China of 1955. 36 pp. Ref.

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