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Is the income gap widening between rich and poor in China? Let’s speak with data.
The Gini coefficient is an important indicator that describes the income gap among members of a country or region, and is often used to reflect the fairness of social wealth distribution. The Gini coefficient is a value between 0 and 1. A higher number indicates a greater level of income inequality.
Based on the introduction of the Gini coefficient by National Bureau of Statistics of China, it is generally believed that when the value of Gini coefficient is less than 0.2, it indicates that the income distribution of residents is too average. It is relatively average between 0.2-0.3, reasonable between 0.3-0.4, significant between 0.4-0.5. When the value is greater than 0.5, it means there is a wide income gap.
According to Statista, a leading global comprehensive database, China’s Gini coefficient dropped from 0.474 in 2012 to 0.462 in 2015, then rose, reached a peak at 0.468 in 2018, followed by a small fluctuation in the next few years between 0.465 to 0.468.
Interestingly, on the basis of data from National Bureau of Statistics of China, the income disparity between households in the lowest 20% bracket and those in the highest 20% bracket, measured by per capita disposable income, narrowed from a ratio of approximately 10.72 times in 2016 to around 10.48 times in 2022. This indicates a slight reduction in the gap between the two income groups over that period.
To sum up, China’s Gini coefficient probably remains high level during recent years while there is still a significant income gap between the top and bottom families, we may consider China's income gap to be a serious problem.