Wu Jinglian: China's Income Gap Stems from Unequal Opportunity

Prof. Wu Jinglian, a renowned economist with the Development Research Center under the State Council, pointed out that the widening income gap in China is mainly due to unequal opportunities.

He made the remarks in his speech titled "The Current Economic Situation" on May 23 at the innovation strategy forum held by the Chinese Academy of Sciences.

While referring to the balance between equality and efficiency, he said, there are two kinds of equality, namely, the equality of opportunity (also called equality of starting-point) and equality of results. The inequality of opportunity provides the source for abnormal income and corruption earning. For example, the abuse of power to create income, this is manifested most prominently in the examination and approval system for license-issuing, material allocation and setting quota for listing. In the process of re-delineating State assets, the power holders, taking advantage of unequal opportunity, may conveniently nibble away and gobble up public property.

He noted that farmers are the most impoverished in China because there is such a huge rural population. To solve the surplus rural labor force, it is necessary to vigorously develop small and medium-sized enterprises. It is reported that urban industrialists and businessmen of Zhejiang Province have started to invest in the countryside, incomplete statistics show that the volume of investment has currently exceeded 10 billion yuan. This is a good tendency, said Wu.

The inequality of result can also enlarge the difference of income. Wu indicated that in the era of the knowledge-based economy, a person without a higher education will definitely be in an inferior competition position, this requires that the State should strengthen the construction of educational system and social security system while reforming the tax system.

He finally stressed that the advancement of reform won't widen the income gap; on the contrary, it will gradually reduce the imparity.



By PD Online staff member Deng Gang


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