The Rural-Urban Income Divide: Macroeconomics
The Rural-Urban Income Divide: Macroeconomics
This chapter states that the strategy of the Chinese government after the year 1949 was to promote rapid urban industrialization. The rural poverty would be alleviated through the transfer of peasants into the urban industrial economy. This strategy was successful, but the benefits it granted were offset by China's large population growth. The chapter also states that despite the rapid industrialization and urbanization, rural labour increased by 150% over the period, while the land was already fully occupied in 1952 and the use of the land could not be expanded significantly. It also states the important fact that the ratio of urban to rural income and consumption, per capita, was substantial during the period of Communist Party rule.
Keywords: rural sector, urban sector, macroeconomics, income divide, urban industrialization
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