China Economy

Li Shi, 'Mr China Income Distribution', battles inequality

Cultural Revolution posting guided thinking of professor who has fought to close wealth gap

PUBLISHED : Wednesday, 07 November, 2012, 12:00am
UPDATED : Monday, 30 May, 2016, 5:00pm


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It's not exactly catchy, but the name Mr China Income Distribution has become well known to those involved in the battle to close the country's wealth gap.

His real name is Professor Li Shi, 57, and he has been charting the spiral into dangerous levels of inequality since the 1980s - and warning of the accompanying dangers of social unrest.

But Li said his interests in economics can be traced back to his graduation from high school in Xuzhou, an industrial city in Jiangsu province. It was 1976, and like millions of others at his age, Li was sent as part of the Cultural Revolution to work with farmers in an outlying village.

The villagers were split according to whether they belonged to the Meng family or the Shao family. When the two groups couldn't agree about naming an accountant, they picked the independent outsider, Li, who until then had been planting wheat.

"That experience has had a great influence on my life. I got to know the status of those living at the bottom of the society," says Li now. "The biggest question confronting me was: why were the farmers so poor?"

The real life in the countryside was in sharp contrast to the state propaganda picture of prosperity, he said. "Prior to that, I had naively believed that everything told by Chairman Mao was truth."

Li said he looked for the answer in Capital by Karl Marx and other textbooks available.

"These books were so boring and some of them were poorly written," Li says. "But my curiosity in economics remained."

The government resumed university admission tests in 1978 and Li entered Nanjing University to study economics, followed by the elite Peking University for his master's degree. He worked at the Chinese Academy of Social Sciences, a think tank, from 1985 to 2005, and as a researcher in the economics department in Oxford University in 2001 and a professor at Hitotsubashi University in Tokyo in 2002.

He ended up at Beijing Normal University - which produced Nobel Prize winners Mo Yan and Liu Xiaobo - leading the research on income distribution, inequality and poverty, an area that other academics seldom touched at that time.

He thinks he now knows why farmers remain so poor despite the nation becoming the world's second-largest economy.

"In the past, large amount of resources have been poured into industrialisation and urbanisation, while development in the rural area has lagged behind," he said. "The government has also limited the flows of rural labour through the hukou, or residence registration, system."