MonitorHow China's widening wealth gap caused the financial crisis
And how narrowing income inequality on the mainland, as reflected in numbers for household spending, is key to a more sustainable economy
Howls of derision greeted the official announcement last week that mainland Chinese income inequality peaked in 2008 and has since been falling.
The sceptics should think again. Not only is it feasible that China's wealth gap has narrowed since the financial crisis, it's excellent news. Widening income inequality not only dangerously destabilised China's own economy, it was also a major cause of the global financial crisis in the first place.
What riled observers last Friday was the publication by China's National Bureau of Statistics of a Gini coefficient for the first time since the year 2000.
If you are not familiar with it, the Gini coefficient measures a country's inequality on a scale of zero to 100. A score of zero would represent perfect equality, with everyone earning the same. In contrast, a score of 100 would see all the income generated by the entire country going to a single person, with everyone else getting nothing at all.
On this measure, the most equal countries in the world are usually reckoned to be the egalitarian social democracies of Scandinavia, which according to the World Bank get scores of around 25.