International

China's Citizens Hide As Much As $2.34 Trillion In Income, Researcher Says

As much as $2.34 trillion in yearly income goes unreported in China, an economics scholar says. Here, an imported car passes a shopping mall in Beijing. i i

As much as $2.34 trillion in yearly income goes unreported in China, an economics scholar says. Here, an imported car passes a shopping mall in Beijing. Vincent Yu/AP hide caption

itoggle caption Vincent Yu/AP
As much as $2.34 trillion in yearly income goes unreported in China, an economics scholar says. Here, an imported car passes a shopping mall in Beijing.

As much as $2.34 trillion in yearly income goes unreported in China, an economics scholar says. Here, an imported car passes a shopping mall in Beijing.

Vincent Yu/AP

China's citizens do not report as much as $2.34 trillion of what they make every year, hiding "gray income" that would represent nearly 20 percent of the country's GDP, Chinese economics scholar Wang Xiaolu says, in a report from the news site Global Voices.

Wang, of Beijing's National Economic Research Institute, told an audience last week (page is in Chinese) that the figure means the gap between rich and poor Chinese is wider than is commonly believed.

Speaking at the Chinese Museum of Finance, Wang renewed an argument he made in an attention-grabbing study of China's income gap in 2010. That work, which relied partly on informal surveying of Chinese wage-earners, drew criticism from the official National Bureau of Statistics. It also sparked a government push to bring "gray income" into the daylight — an effort that met with little success.

China's non-reported income is believed to have many origins, from bribes for corrupt officials and under-the-table deals between merchants to monetary gifts bestowed upon doctors and nurses.

As we recently reported, the pervasive covering-up of revenue made efforts to list China's richest citizens difficult, with the magazine Hurun Report concluding that "valuing the wealth of China's richest is as much an art as it is a science."

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