Accounting for the Gender Income Gap in Urban China

Using data from the China Housing Survey, that was conducted in 1993, the present study attempts to learn whether and how specific factors--human capital (including education and health), guanxi (social connections), housework, and employment in different sectors of the economy influence the income gap between men and women in urban China when traditional, socialist, and market mechanisms are all present.

The data were collected from two large Chinese cities, Tianjin and Shanghai. The results of regression show that 1) Differences in education account for much of the gender differences in income. With the same amount of education, women still earn somewhat less than men. Health reduces the gender income gap between men and women in urban China. 2) Sector segregation accounts for much of the gender differences in income. The private sector pays much more than the public sector. Guanxi and housework do not help explain the difference in income between men and women.

The present study reveals that the income inequality between men and women comes mainly from market forces. The market factors of education, health, and sector are the primary areas in which women suffer disadvantages that result in their lower income.