China’s Rural–Urban Inequality in the Countryside

When income is examined with regard to the rural and urban sectors in China, the definition of rural/urban has to be clarified, specifically in terms of how the rural and urban sectors are divided.

This book investigates rural–urban income inequality in China, and the existing literature has examined this issue extensively. Whereas the purpose of this book is to explore from the rural perspective we believe the following theories and thoughts are closely related to our research.

Government policies and institutions are the driving force behind resource flows at the macro-economic level. This chapter examines the major policies and institutions that have directed the intersectoral resource flows, which ultimately have an impact on rural income as well as rural–urban income disparities.

Large volumes of studies have been carried out concerning China’s rural–urban income inequality (Chen et al. in The trend of the Gini coefficient of China, 2010; Ding in China Econ Rev 13:419–429, 2002; Li et al. in Rising inequality in China: Challenges to a harmonious society. Cambridge University Press, 2013; Mukhopadhaya in J Asia Pac Econ 18:304–317, 2013; Xie and Zhou in Proc Nat Acad Sci 111:6928–6933, 2014; Yang and Cai in How Far Across the river, 389–416, 2003). These studies have generally reached an agreement that China’s income inequality has been on a rise in the market-oriented reforms. Besides, it is the sector differences between the rural and urban populations that made the dominant contribution to the overall inequality.

The fieldwork for this study was conducted in Qinggang County, Heilongjiang Province. Located in east central Heilongjiang, Qinggang is one of the grain producing counties of the province with maize as its major product if not the only one (other grains and vegetables grown there are mostly for self-consumption). Qinggang County is in the hinterland of the Songnen Plain, 120 km north of the provincial capital Harbin and 120 km east of Daqing, the city famous for its oil resources. No railway service is available in the county, though it is universal throughout China. Its transport link to the outside relies on buses and private vehicles (There are many bus services available from Harbin to other places by way of Qinggang. But when the fieldwork was conducted the only one between Harbin and Qinggang was a mini-bus service, which was extremely unreliable because of the poor condition of the vehicles. The first author took twice, and for both times the mini-buses broke down on the way).

Our first ‘official’ knowledge about peasants was from the Director of Rural Affairs Committee of Daoli District, Harbin City. While driving the first author to do a pilot study, he commented that peasants were both ‘pitiful’ and ‘hateful’. It is easy to understand how pitiful they are. By having a brief look at the poverty they have been living in, one could not help sympathizing with them. As to why peasants are hateful, according to the Director, it was extremely difficult to talk them through any policies. One of the examples was the compensation for land confiscation. It was stipulated that if there was any building or construction (such as a well) on the land confiscated, a higher compensation would be given by the government. However, many peasants would only pay attention to the latter half of the sentence without thinking of the condition. This meant that many peasants went to the government offices asking for higher compensation without listening to the explanation. This has made working with the peasants difficult especially in the implementation of a new policy. In the following chapter, we will explore the views of local officials on various issues.

This research has combined qualitative and quantitative methods to investigate rural–urban income disparities. Both qualitative and quantitative methods have shown that counties like Qinggang in Heilongjiang are at a very low level of development. The interview data indicate that farming was almost the only source of peasants’ income and maize as their major product. The peasants were largely confined to the land, with few income-generating opportunities, apart from agriculture. The quantitative results confirm that transferring the surplus labour out of agriculture will help to increase rural income, thus reducing the rural–urban income gap.

On entering Qinggang, a catchy slogan by the road came into sight, saying ‘precise poverty alleviation to initiate motivity; three-year decisive battle for moderate prosperity ahead of schedule’ (精准扶贫, 激发内生动力; 决战三年, 提前奔向小康.). While the first author still could not remove out of the mind the image of Qinggang in 2006, a question came up immediately: is it still the county in poverty as ten years ago?