Ming Lu and Zhao Chen*
Third Version, May 2004 (Comments welcome.)
Abstract: The analysis based on the provincial panel data during 1987-2001 shows that urbanization significantly
decreases the statistical urban-rural inequality. We also find that inter-provincial migration, economic opening,
employment restructuring, and governmental participation in the economic activities tend to enlarge the urban-rural inequality. The structure of local governmental expenditure is also found to have significant effects on
urban-rural inequality. This study suggests that the enlarging urban-rural inequality is due to local governmental economic policies that are somewhat urban-biased.
Key Words: Urbanization, Economic Policies, Urban-Rural Inequality, Panel Data
Third Version, May 2004 (Comments welcome.)
Abstract: The analysis based on the provincial panel data during 1987-2001 shows that urbanization significantly
decreases the statistical urban-rural inequality. We also find that inter-provincial migration, economic opening,
employment restructuring, and governmental participation in the economic activities tend to enlarge the urban-rural inequality. The structure of local governmental expenditure is also found to have significant effects on
urban-rural inequality. This study suggests that the enlarging urban-rural inequality is due to local governmental economic policies that are somewhat urban-biased.
Key Words: Urbanization, Economic Policies, Urban-Rural Inequality, Panel Data
