Abstract
This study investigates the impact of COVID-19 and social distancing policies on regional income inequality. We base our study on a sample of 295 prefecture (and above) cities in 31 provinces in China. A distribution dynamics approach is employed to reveal the trend and movement of disposable income per capita in each city before the COVID-19 pandemic, during the COVID-19 pandemic, and in the period when the COVID-19 was under the control. The findings reveal significant negative economic consequences of the COVID-19 in the first quarter of 2020 and show that most cities will converge to a level of disposable income which is much less than the Pre-COVID level if the COVID pandemic persists. Regional income inequality has intensified in the cities that have a longer duration of stringent social distancing policies during the COVID-19 pandemic and disappeared in the cities with policies of short duration. Disposable income per capita for urban residents recovered quickly when the transmission of coronavirus was effectively contained; and yet the impact of the pandemic on rural residents remains unresolved, if not intensified. This study demonstrates a significant divergence of the trend of disposable income across cities with different durations of social distancing policies and between urban and rural residents. It also highlights the importance of stringent social distancing policies in containing the spread of virus in a short time and calls for special policy attention for rural regions in the recovery from the COVID-19.
Highlights
Up to March 2021, the COVID-19 pandemic has infected millions and caused millions of deaths across the globe1
We focus on the disposable incomes before the outbreak of COVID-19 (2019Q4), the quarter of outbreak (2020Q1), and the quarters after the coronavirus was under control in most of regions (2020Q2 and 2020Q3)4
If the COVID dynamics persist, most cities will converge to relative disposable income per capita (RDIPC) value which is less than the Pre-COVID level and disparity will be intensified due to the pandemic
Summary
Up to March 2021, the COVID-19 pandemic has infected millions and caused millions of deaths across the globe. How COVID-19 crisis affects income inequality within countries has not been explored, different regions in a country may expose to different levels of coronavirus transmission risks, adopt different policies to contain the spread of the virus, have different capacity to cope with the outbreak of the virus and suffer the different mortality and economic loss. This study fills this gap by investigating the impacts of COVID-19 and the associated social distancing policies on regional income inequality in China. Appendix 1 presents the numbers of new daily cases in overall 31 provinces, in Hubei and in non-Hubei provinces from January 20, 2020 to December 30, 2020
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
