On May 17, 2014, the SDSN, in partnership with Beijing Normal University, hosted an expert roundtable entitled “The Challenges of Social Inclusion.” The objectives of this meeting were to learn from China’s experiences of reducing inequality and social exclusion and to discuss opportunities for the SDSN to drive progress on social inclusion, working across countries and sectors, and capitalizing on the opportunity presented by the Post-2015 process.
Brief opening remarks were provided by Professor LI Shi (BNU), Professor Joshua Castellino (SDSN and Middlesex University) and Mr. Christophe Bahuet (UNDP – Moderator) outlining the objectives for the day. Professor Castellino also explained SDSN’s unique role, as a bridge for academics to feed their evidence into UN intergovernmental processes, such as the discussions relating to the post-2015 or Sustainable Development Goal agenda.
The presentations that followed focused on the nature and scale of inequalities in China. Professor LI and Professor WANG Dewan (World Bank) both highlighted rising levels of income and wealth inequality in China, and acute disparities between urban and rural populations, in income, social security and access to public services (also reiterated by Professor WANG Tianfu later in the proceedings). Professor LI showed that in 2007 urban-rural inequality accounted for 51% of total inequality in China (using a Theil Index).
Professor Guanghua Wan (Asian Development Bank) then provided a comparative analysis of inequality across Asia. Inequality has been rising in countries accounting for 80% of Asia’s total population. The richest 1% of Asian households now account for 6-8% of total expenditure.
A discussion ensued on gaps in the evidence base, for example on social mobility, and on inherent challenges. For example, urbanization was cited as a means of redressing unequal access to social services but urbanization itself can also be driver of dimensions of deprivation and exclusion.
Following the break, Professor Jeffrey Sach’s discussed the theoretical underpinnings of concepts of inequality, citing examples from the USA. There followed an exploration of policy responses and potential solutions, including presentations from Mr. YU Jiantuo (CDRF), focused on women’s economic empowerment in the context of urbanization and from Mr. LI Hongjie (State Ethnic Affairs Commission) who provided a case study of the Orogen Nationality, a semi-nomadic minority nationality that live in Heilongjiang Province.
Important conclusions were that rapid income and wealth accumulation by the top 1-5% of the population has considerably intensified income inequality in China. Other forms of exclusion have coupled with income inequality to intensify vulnerabilities at the bottom of the socio-economic scale, for example for poor migrant workers moving to cities, who are unable to access social insurance and basic services, in large part due to slow reform of the hukou system (China’s regional household registration system). Rising inequality trends appear to be mirrored across other leading Asian economies such as India and Indonesia, as well as continent-wide (discounting Japan and Korea which as OECD members fell outside the purview of the analysis conducted by the Asian Development Bank).
Positively, China has placed certain dimensions of inequality (including income inequality) at the forefront of its policy agenda. Thus the government appears mindful of the growing gap, and is undertaking or planning a series of measures designed to redress the balance. In other Asian countries however these issues are not at the forefront of policy-making, and the risk attendant to ignoring this issue is significant.
Increased urbanisation is undoubtedly contributing to rising growth and employment for many Chinese citizens, helping to improve many people’s living standards, however there are concerns about the emergence of an urban underclass, as well as environmental stress and planetary boundaries. If such obstacles could be overcome (and there is evidence for this in some of China’s growing urban centres) it could strike a blow for the reduction of inequality, if pursued alongside better targeting of the newly urbanised populations, providing access to services, and the training and education necessary to build medium and longer-term social capital. Such urbanisation would need to be carefullyscrutinised for its gendered impact in particular, especially if it results in male migration with women left behind to exclusively care for children and the elderly.
Following the event Professor LI Shi, Professor of Economics at Beijing Normal University and a member of the People’s Republic of China’s State Council Poverty Alleviation Office Expert Advisory,accepted Professor Joshua Castellino’s invitation to become a member of the SDSN’s Thematic Group on Gender, Inequality and Human Rights.
For more information please contact Jessica Espey.
The Challenges of Social Inclusion – Jeffrey Sachs, SDSN
Inclusive Urbanization and Rural-Urban Integration – Elena Glinskaya and Dewen Wang, World Bank
Rising Income and Wealth Inequality in China – Li Shi, Beijing Normal University
A Comparative Analysis of Inequality Across Asian Countries – Guanghua Wan