Fragile China

Economist Gan Li and his researchers at Chengdu’s Southwestern University of Finance and Economics  showed that China’s Gini coefficient, a measure of income inequality, had reached 0.61, well above the 0.4 level widely considered destabilizing by economists.

 The top 1 percent held more than one-quarter of China’s wealth, while 430 million Chinese struggled day-to-day.

Gan’s research on China’s housing sector figures that 70 percent of total household wealth is made up of the value of apartments. About 50 million already-sold units sit empty, much more than some investment banks had estimated. (The government doesn’t release national data on empty apartments.) China has a vacancy rate of 18 percent, compared with 13 percent in the U.S., Gan says.