Demographic changes and household income in urban China: 1988–2002

Abstract

This article documents the major demographic changes during recent years in urban China using the China Household Income Project (CHIP) 1988, 1995 and 2002 data. It also presents the changing levels and compositions of household income in urban China, and examines the impact of the changing demographics on household income. Findings indicate that urban residents have become older and more educated. Individuals are more likely to be employed in the private sector, retired or unemployed as the market economic reforms have progressed. At the household level, household size has been decreasing, with fewer children and higher number of older persons, while the proportions of nuclear families with only one child as well as couples without children have been increasing. Meanwhile, household per capita income has been rising continuously over the years. Several important demographic characteristics have been significantly associated with household income levels. Households whose heads were older, with higher education levels, Communist Party members or retired, and households composed of couples without children have tended to receive higher income across all three study years. In addition, households with larger sizes, particularly more children, with unemployed heads and three-generation families with more than one child have tended to receive lower income. More public benefits should be provided to the less advantaged, such as families with more children, older persons without pensions or other subsidies, those with lower education levels and the unemployed, to meet their needs and improve their economic well-being.

Keywords:

• demographics
• household income
• public benefits
• China
• urban

Acknowledgements

An earlier version of this article was presented at the 29th General Conference of the International Association for Research in Income and Wealth in Joensuu, Finland, 20–26 August 20, 2006. We thank Thesia Garner, Björn Gustafsson, Peter Saunders, Peter van de Ven and other participants of the session ‘Ageing and Demographic Change’ for helpful comments. We also thank the editor and the referees for helpful comments and feedback. The CHIP surveys that provide data for this research were funded by the Asian Development Bank, the Ford Foundation and the Swedish International Development Agency.

Notes

1. According to the official CPI, in urban areas, 100 yuan in 2002 is equivalent to 39.7 yuan in 1988 and 90.4 yuan in 1995 (Source: NBS 2004, p. 88).