Guest Editors' Introduction

• Published date: 01 January 2022
• Author: Shi Li,Ximing Yue
• Date: 01 January 2022
• DOI: http://doi.org/10.1111/cwe.12399

China & World Economy / 1–4, Vol. 30, No. 1, 2022 1

©2022 Institute of World Economics and Politics, Chinese Academy of Social Sciences

Guest Editors’ Introduction

Shi Li, Ximing Yue*1

China has entered a new stage of social and economic development, having eliminated

absolute poverty by the end of 2020. Common prosperity will be a new goal in this

new development stage. There are domestic and international reasons for China to

promote common prosperity as a new development goal. Domestically, the reform and

opening-up policies over the past 40 years have promoted rapid economic growth and

a considerable improvement in Chinese living standards but the problem of unbalanced

development has not been solved effectively. This problem is manifested in all aspects

of social and economic development, including excessive income inequality and unfair

income distribution, regional disparities, a significantly large urban-rural gap, and

unequal access to basic public services among different population groups.

The problem of unbalanced development has also become an obstacle to further

economic and social development. In terms of income distribution alone, the slow

growth of household income and large income inequality have led to insufficient

consumption demand. Another important factor affecting consumption demand is the

large income gap. In the process of economic transformation in the past 40 years, the

problem of a widening income gap has become very conspicuous.

Due to the unbalanced development and the large income inequality, the problem

of relative poverty has become evident in China even after the elimination of absolute

poverty. The relatively poor population in rural areas exceeded 100 million in 2018

based on the registered residence population in rural areas. If estimated for the

permanent population, the fi gure was about 60 million. According to the national relative

poverty standard (40 percent of the national median income), the current incidence of

rural relative poverty is as high as 23 percent, and the relatively poor population is close

to 200 million. These important problems constitute the domestic background against

which Chinese policymakers are promoting common prosperity.

*Shi Li, Director, Institute for Common Prosperity and Development, and Distinguished Professor, School of

Public Affairs, Zhejiang University, China. Email: lishi9@zju.edu.cn. Ximing Yue, Professor, School of Finance,

Renmin University of China. Email: yue@ruc.edu.cn.