Middle-income Income Mobility

Income distribution is an important research area in economics. At present, in the income distribution research area, most scholars researched income distribution gap, while the academic literature of income mobility, which is one of the academic frontier, is less. According to the theory of income mobility, the larger income mobility can promote fair income, even can reduce the performance of various kinds of income distribution gaps, and can provide more equitable opportunities for people. So the study on income mobility is very meaningful.China's reform and opening up obtained enormous economic achievements, but also expanded the income gap. Many scholars believe that China's Gini coefficient has exceeded the international alert line of 0.4, so the income gap should be reduced, the proportion of middle-income people should be actively expand, the "pyramid" type of income distribution, which is negative to social stability, should be changed. In this case, combining the study of income mobility and middle-income people is very meaningful, now the research on both of the two aspects is less, our research results may be very significant.This article studies the income distribution of the middle-income people in China from the perspective of fare income opportunities, so the middle-income people and the income mobility, which is a new bright spot in the income distribution research area, are chosen as the main research objects, try to detail and deepen the theoretical and empirical analysis on the income mobility of the middle-income people in China as much as possible.The idea of this article can be logically divided into four parts. The first part is the introduction, in this part, the background and significance of the research is summarized, the research contents, methods, possible innovations are explained, and the structural arrangements are given. The second part is the theory, methods and literature review, including the second and third chapters. In this part, theories of the middle-income people, income distribution gap and income mobility are reviewed, then relevant domestic and international research trends and research methods are reviewed, in order to laying the foundation for the following empirical research from the theory and methods aspects. The third part is the empirical analysis, including the fourth chapter to the eighth chapter. In this part, the relative and absolute income mobility of the middle-income people in China are calculated, factors which can influence the income mobility of the middle-income people in China are analyzed, and then some empirical analysis on the income mobility of the middle-income people in China, economic growth, social stability and income distribution gap are made. The fourth part are the policy recommendations, it is the ninth chapter, in which relevant policy recommendations are given according to the foregoing conclusions.Empirical analysis is the focus of this article. The author mainly follows the ideas and methods which used by Fields who studied income mobility, to calculate the income mobility of the middle-income people in China. Then according to the results, the author makes a further empirical analysis combine of economic growth and social stability. First, the author defines the middle-income people in China reasonably based on micro panel data, taking differences between urban and rural areas, international standards into account, organically combines the relative and absolute definition. The author uses the binary choice model to investigate the impact factors of the middle-income people, combined with personal characteristics data. The author calculates Gini coefficient within the middle-income people, and then calculates the "income mobility as a device for long-term income equality" P index. Within the middle-income people, the author according to the five bisection method to calculate the relative income mobility in the short, medium and long-term interval transition matrix of income, and uses multiple choice model to examine the factors of internal transition levels, combined with personal characteristics data. For the high, medium and low income people, the author uses the multiple choice model to examine the factors of external transition levels, combined with personal characteristics data, then the author calculates the relative income mobility in the short, medium and long-term interval transition matrix of income. Then the author uses the absolute income mobility index and decomposition method of Fields to calculate the unit and percentage external absolute income mobility of the middle-income people, and calculates the growth and transfer parts of the external absolute income mobility of the middle-income people, then explores the relationship between the growth part, transfer part, and the regional GDP growth rate. The author takes empirical analysis of the growth part of the absolute income mobility and total factor productivity of some regions, to research which kind of growth can enhance the growth part of the absolute income mobility, extensive growth or intensive growth. Then the author further analyzes which can influence more on the growth part of the absolute income mobility, the technological progress or the overall efficiency. At the same time, the author makes empirical analysis of the transfer part of the absolute income mobility, the income gap between the middle-income people, and the social stability of some regions, in order to research whether higher income transfer and expanding the proportion of middle-income people are conducive to social stability.Through theoretical and empirical research, the author at last summarizes the general conclusions and the original conclusions, the original conclusions are as follows: the individual characteristics of middle-income people in China, there is a trend that people's income moves close to the lower income groups within the middle-income people in China, the overall efficiency of Shanghai has been the highest, the individual characteristics of people who are easy to transit to a higher level of income, the growth and the transfer parts of the absolute income mobility take opposite effects on the GDP growth rate, intensive growth is conducive to the growth of people's income, technological progress is more conducive to the growth part of the absolute income mobility than efficiency. Finally, the author makes a number of policy recommendations on how to increase the income mobility and how to expand the proportion of middle-income people.