Study On Rational Adjustment Of Income Distribution Relationship In China

In2008, the proportion of the first income distribution in the household sector inGNI is57.40%and the redistribution in GNI is57.11%. Both proportions havewitnessed decreasing year by year since1992.In2010, the Geordie Coefficient of the urban and rural residents reached0.48.The per capita disposable income in10%of the highest income household was8.6times of that in10%of the lowest one. The per capita net income of the high-incomerural residents was7.5times of that of the low-income ones; the disposable income ofthe urban residents was3.23times of that of the rural ones; the income gap betweenthe eastern residents and the western ones is1.5times; the gap between the highestincome industry and the lowest one is up to13.26times.In China, the proportion of the payment for labors in GNI corresponds toeconomic development level and its increment should be less than5percentage points.The low income level and excessive income gap are mainly caused by three reasons.Firstly, labor productivity is low. The labor productivity in U.S. in the year2010was13times of that in China. One person in U.S. equals to13persons in China allocatesthe same output value and the same proportional payment for labors. Secondly,expenditures for social securities are insufficient. In2010, the proportion of theexpenditures for public services including education, medical care and social securityin the total expenditures of the government account for41.0%, lower than thosecountries of per capita GDP3000-6000dollars for13percentage points. Thirdly, theregulation ability of redistribution is weak. About99.19%of disposable income in thehousehold sector is coming from the first distribution, which rarely can get moreincome from redistribution.Rational adjustment of income distribution relationship is a complicated andsystematic project. The measures should be taken both from its root cause andsymptoms to reform comprehensively. Firstly, in the aspect of the first distribution, itshould make quantitative regulation objectives, reasonable determine the tax andestablish income growth mechanism. Secondly, in the aspect of redistribution, thereform of the fiscal and tax system should be deepened and the public financial shouldbe increased. Thirdly, in the aspect of transformation of government functions, thenon-tax revenue should be regulated and clearly specified of the frequent transferpayments. Fourthly, in the aspect of reform, it should complete economic and socialsystems, consolidate the foundation of the income distribution, transform the mode ofeconomic development so as to play the active role of third distribution.