REGIONAL VARIATION IN EARNINGS INEQUALITY
                                 
                     IN REFORM-ERA URBAN CHINA




ABSTRACT

This paper studies the regional variation in earnings inequality in

contemporary urban China, focussing on the relationship between the

pace of economic reforms and earnings determination.  Through a

multi-level analysis, we show that economic growth depresses the

returns to education and work experience and does not affect the

net differences between party members and non-members and between

men and women.  Overall earnings inequality remains low and only

slightly correlated with economic growth, in part because the

tendency toward higher levels of inequality in faster-growing

cities is somewhat offset by the lower returns to human capital in

these cities.  Our analyses decomposing employment earnings into

regular salary/wage and bonuses/subsidies support the

interpretation that these results are largely due to the lack of a

true labor market in urban China.  xxxxxx