Causes of Widening Wealth Gap in Hong Kong

Causes of Widening Wealth Gap In Hong Kong

Yeung Chi Kit

GE 1401 University English T04

MCGETTIGAN ,Jane Elizabeth

5 October 2011

p.1

In Hong Kong, It is often easier to see the wealth gap here, with all the big

shopping malls and the public house estates that stand in great numbers.

In fact, rising income inequality has been a common feature of most developed

countries, and Hong Kong is no exception.

According to The Hong Kong Council of Social Service’s Study, which was

conducted in 2009 , the median monthly income of high income households has

been dramatically increased by 150% from HK$13000 to HK$32600 in the period

of1989 to 2009. In the contrast, the median monthly income of low income

households has only slightly increased from HK$5000 to HK$9000(80%) in the

same period. These figures have clearly shown that the wealth gap between the

rich and the poor in Hong Kong has been widening. There are a variety of factors

contributing to the widening wealth gap between the rich and the poor in Hong

Kong. Two main factors will be focused on this essay: economic transition and

ineffectiveness of government policy.

First of all, the widening wealth gap is related to economic transition.

Riskin, Zhao and Li(2001)observe that “economic growth itself in its early stages

is likely to give rise to increasing inequality, because growth tends to occur in a

manner that is geographically and sectorally unbalanced”(p.8). Since the Hong

Kong’s economic structure has shifted from manufacturing to the knowledge

based economy, high-educated manpower is demanded. Businessmen,

professionals and managers who are high educated are then able to leverage their

knowledge and talent into their respective aspect to develop their own careers in

Hong Kong. As a result, they are able to have a foreseeable sparkling career future

and...