Urbanization, Inequality, and Poverty in the People’s Republic of China

Abstract

Urbanization is considered to be an engine of economic growth in developing countries. Driven by policies of economic reforms and opening up, the structural changes ushered in an era of sustained and rapid economic growth for the People’s Republic of China (PRC). As a consequence, rural and urban poverty declined dramatically. At the same time, income inequality increased rapidly. To understand these important observations, this chapter inquires into the role played by urbanization in economic growth, poverty reduction, and the evolution of inequality in the PRC. Specifically, this chapter (1) analyses the relationship between urbanization, economic growth, and the evolution of inequality in the PRC; (2) focuses on the urban labour market and urban poverty; (3) portrays the multifaceted nature of poverty in the process of urbanization; and (4) analyses the effect of some anti-poverty and inequality policies in the context of urbanization.