Abstract
Higher income volatility is associated with a higher risk and a reduction in well-being. Income volatility is widely studied in many advanced economies, yet little is known about income volatility in China. In this paper we document trends in earnings volatility and household income volatility in urban China and examine what are the driving forces. Using the China Urban Household Survey, we find that male earnings volatility increased by 89% between 1992 and 2009. Earnings volatility is higher for older, less educated, and those who work in private service sector and non-SOEs. Decomposition analysis suggests that couple’s earnings shocks are positively correlated, while transfer income and other income help smooth out head earnings shocks. In addition, transfer income and other non-transfer income plays a larger role in smoothing out head earnings shocks for poorer households.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: 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.