Rural-Urban Economic Disparities among China’s Elderly

with the most off-farm opportunities. Furthermore, as the reform advances this disparity
will tend to exacerbate income inequality, both within the rural sector and among the rural
and urban sectors.

4.3. Income and age

It is generally accepted that income distribution (and inequality) is related to the life cycle
(age). In the case of China’s income distribution studies, however, the results are
ambiguous. While Gray (1982) suggested that inequality in earnings could be greatly
explained by differences in age and gender, studies by Park (1987) and (Hsiung and
Putterman (1989) found that life-cycle factors failed to explain a substantial part of
inequality. Pudney (1993) found that even though there is evidence of a life-cycle pattern
of income earnings and wealth accumulation in China, only a very small part of observed
inequality could indeed, be traced to life-cycle factors.

More recently, Benjamin and Brandt (1999) indicate age to be “another potential
determinant of income inequality” (pg. 294). We would expect that since our target group
is the elderly age would play a lesser role. Below we have cross tabulations of income by
age.

Table 7: Family income by age (% of households)

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