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How Does Real Exchange Rate Influence Income Inequality Between Urban And Rural Areas In China?
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Auteur(s) :
GUILLAUMONT JEANNENEY [S]
,
HUA [P]
Abstract / Résumé : The channels through which the real exchange rate influences urban/rural per capita real income
inequality are analyzed using yearly data for 28 Chinese provinces. Due to the higher share of tradable
goods produced in urban than rural areas, the real depreciation of the Chinese currency raised the
urban bias, contrary to the effect usually expected. This rise was, however, mitigated because of the
impact of the exchange rate on the urban/rural consumer price ratio, real public wages, and the ratio of
industrial/agricultural protection rates. It disappeared for coastal provinces due to the strong
development of outward-oriented rural industrial activities.











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