How do Chinese people reconcile China’s relatively high…
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How do Chinese people reconcile China’s relatively high Gini coefficient with the idea that China is a socialist country?
I’m genuinely curious about this. China has obviously accomplished something remarkable economically over the last 40 years. But at the same time, China has a fairly high level of income inequality.
The World Bank puts China’s official income-based Gini coefficient at 46.5 in 2024.
What’s interesting to me is that this seems quite different from the experience of many of the European countries that previously had socialist economies. For example, research on the former German Democratic Republic found that income distribution there was far less unequal than in West Germany. One study puts the Gini for East Germany at about 0.185 in 1990.
More broadly, the IMF notes that Gini coefficients in socialist Eastern European economies in the late 1980s were generally around 23–24, substantially below those of Western market economies at the time.
Obviously, I’m not arguing that the GDR or other communist countries were better places to live. They had plenty of serious economic and political problems, and low measured income inequality doesn’t tell you everything about living standards or access to goods.
But it does make me wonder: How does China have such high inequality and claim to be socialist? There are many capitalist countries that have much lower income inequality.
#local
I’m genuinely curious about this. China has obviously accomplished something remarkable economically over the last 40 years. But at the same time, China has a fairly high level of income inequality.
The World Bank puts China’s official income-based Gini coefficient at 46.5 in 2024.
What’s interesting to me is that this seems quite different from the experience of many of the European countries that previously had socialist economies. For example, research on the former German Democratic Republic found that income distribution there was far less unequal than in West Germany. One study puts the Gini for East Germany at about 0.185 in 1990.
More broadly, the IMF notes that Gini coefficients in socialist Eastern European economies in the late 1980s were generally around 23–24, substantially below those of Western market economies at the time.
Obviously, I’m not arguing that the GDR or other communist countries were better places to live. They had plenty of serious economic and political problems, and low measured income inequality doesn’t tell you everything about living standards or access to goods.
But it does make me wonder: How does China have such high inequality and claim to be socialist? There are many capitalist countries that have much lower income inequality.
#local
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