China’s Wealth Gap Grows

January 19, 2013

Unlocking Word Meanings
Read the following words/expressions found in today’s article.

1. gap (n.) 
[gap]– difference between two things
Example: The age gap between 10-year-olds and 8-year-olds is 2 years.

2. average (n.) [av-er-ij, av-rij]–  the general or typical value or amount of something
Example: The average number of children in Japanese households is 1.96.

3. uncommon (adj.) [uhn-kom-uhn]– unusual or rare
Example:   Extreme poverty is uncommon in well developed countries.

4. disposable income (n.) [dih-spoh-zuh-buhl] [in-kuhm]– a person’s total income after taxes have been subtracted
Example: The man used his disposable income to buy a car.

5. pension (n.) [pen-shuhn]– an allowance given to a retired person by a company or by the government
Example: He lived off using the pension paid by the government.

Read the text below.

A study released by the Chinese Household Finance Survey Center of Chengdu last December shows there is a large gap between the rich and the poor in China.

The report says China’s Gini coefficient is 0.61 for the year 2010. The Gini coefficient is a number that shows how big the gap is between the rich and poor. A country’s Gini coefficient is between 0 and 1. If the score is closer to 1, it means that there is a big difference in people’s wealth and income.

A score exceeding 0.4 shows there is high inequality in a country. According to the World Bank, the world’s average score is 0.44.

The research from Chengdu says that China’s score is uncommon in the world, but it is not surprising for a country with a quickly growing economy to have such a high result.

About 57% of the total disposable income of the country was from only 10% of Chinese households. Meanwhile, China’s eastern provinces had an overall income that was 2.7 times greater than the income of west and central provinces.

Pension incomes were largely responsible for the inequality. In rural areas, only 34.5% of people received pension from the government, equal to 12,000 yuan per person per year.  In cities, 87% of the population got pension, worth 37,000 yuan per person per year.

The Chengdu report suggests that the government use the 3.8 trillion yuan earned by government-owned businesses last year to support people with low incomes. By distributing government profits to the poor, China could decrease its Gini coefficient to 0.4 after a few years.

Viewpoint Discussion
Enjoy a discussion with your tutor. 

Discussion A

·         Should people just accept a big difference between rich and poor people? Please explain your answer.
·         What are some reasons why there are more poor people than rich people?

Discussion B

·         Do you think there is a big wealth gap in your country? What makes you say so?
·         How do you think people would feel if they had a wealth gap in their country?


January 19, 2013