ABSTRACT
This chapter provides an overview of the status of income distribution in urban and rural areas and discusses the income gap and identifies the key factors affecting income inequality. It describes the path by which the financial crisis impacts the income distribution pattern and devises income distribution policy options to respond to the crisis. The income gap has increasingly widened among Chinese residents. Among all factors affecting the income distribution pattern, the urban-rural disparity is the largest contributor to income inequality. The empirical-study part of this report mainly involves analyzing the actual status of income distribution. The policy options put forward in this report are built upon the fundamental principles of "equal opportunity" and "equal conditions." Rural migrant laborers have helped shrink the urban-rural and regional income gaps. However, when the economy is slowed by the global financial crisis to, a number of public actions are crucial and urgent to reduce income inequality and enhance social stability.
