Regional Consumption Inequality in China: An Oaxaca‐Blinder Decomposition at the Prefectural Level

Sharp regional differences in income and consumption patterns have characterized the Chinese development process. Focusing on the years 2007 and 2012, this work employs the Oaxaca‐Blinder decomposition to assess the extent and the determinants of the urban/non‐urban and coastal/inland disparity in c...

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Bibliographic Details
Published inGrowth and change Vol. 48; no. 3; pp. 459 - 486
Main Authors Bin, Peng, Fracasso, Andrea
Format Journal Article
LanguageEnglish
Published Lexington Blackwell Publishing Ltd 01.09.2017
Subjects
Consumption patterns
Foreign investment
Inequality
Regional variations
Welfare state
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Summary:Sharp regional differences in income and consumption patterns have characterized the Chinese development process. Focusing on the years 2007 and 2012, this work employs the Oaxaca‐Blinder decomposition to assess the extent and the determinants of the urban/non‐urban and coastal/inland disparity in consumption patterns. The analysis shows that the average gaps across the Chinese prefectures tend to be mainly explained, along both divides, by the mean differences in local endowments of the covariates that explain consumption over GDP ratio. In particular, at the basis of the observed regional disparity, there is an uneven allocation of FDI and foreign enterprises, as well as of domestic investments in fixed assets and welfare state provisions.
Bibliography:Peng Bin is a Research fellow at the School of International Studies, University of Trento, Italy. Her e‐mail address is
Financial support received through the project “Cambiamento istituzionale, crescita economica e sviluppo sociale,” funded by the Autonomous Province of Trento (Italy), is gratefully acknowledged. The authors would like to thank an anonymous reviewer and the editor for insightful comments and suggestions. The authors are solely responsible for any errors contained in the article.
andrea.fracasso@unitn.it
Peng.Bin@unitn.it
Andrea Fracasso is a Full Professor at the Department of Economics and Management, and at the School of International Studies, University of Trento, Italy. His e‐mail address is
ISSN:0017-4815
1468-2257
DOI:10.1111/grow.12167