Market transition and the persistence of power: The changing stratification system in urban China

Research on transitional socialist societies has explored trends in income inequality and issues concerning who gains and who loses during market reforms. We find that income inequality in a major Chinese city declined only slightly during the first decade of reform policies; it then increased dramatically in the subsequent five years. Strategic position in the state bureaucracy continues to be an important determinant of income, although connections to the market system are becoming alternate sources of advantage. We interpret these findings in light of the historical and institutional context of urban China.