China is changing rapidly. The industrial sector is growing swiftly and the economy
is in transition towards a market economy. Labor markets are developing in a
situation with great differences in living standards between rural and urban areas.
These processes occur at different speeds in various regions of this very large and
populous country. While some households are improving their standards of living,
others are left behind. Therefore economic inequality in China is on the rise.
To describe and analyse this development poses a considerable challenge to
economists and other social scientists. Today researchers are much better equipped
than previously to study poverty, income inequality, earnings inequality, incomeand
earnings-determination, the gender earnings gap and the economic situation of
ethnic minorities. Present-day researchers into China are not constrained to begin
their statistical analysis with what is available in official statistical publications.
They can apply modern quantitative methods to analyse microdata on individuals
and households.
This paper describes and discusses quantitative data which have been used
to study research questions relating to household income in China in order
to illuminate their advantages and disadvantages. We will draw on our own
experience as well as on what others have written. As the literature is far from
limited we do not claim that our coverage of the issue is complete.