Hong Kong has a strong economic development and it is famous for its financial status, with a USD$36796 per capita GDP. Such a high per capita national income can be reflect the average living standard of HongKonger is relatively high, but disappointingly it is not the case in Hong Kong. It is because of wealth disparity. Compared Hong Kongs income disparity with five developed countries – Canada, Britain, the United States, Singapore and Australia. Hong Kong fared the worst, with a Gini coefficient of 0.537. Therefore, the most emergent thing HKSAR government should deal with is not to boost its economy, but narrow the gap between the low and high income group. To show inequality in our society, central business district can demonstrate. Central business district is an area agglomerate kinds of international companies regional headquarter. High rise buildings like IFC is an iconic scenery in Hong Kong. But behind the prosperity area, there is a place called Wan Chai, so called the inner city where can we find urban decay happened. Here we can find shop-houses, a mixed land use feature. Below residential flat, there is wet market. Problems of over crowding and congestion happen. The living environment is unpleasant. Moreover, these over 50 years old buildings are lack of maintenance. These housings are dangerous in structure which cause a threat to public safety. Like the Ma Tau Wat road old building collapses in 2011, caused 4 victims dead. The comparison in Central and its adjacent Wan Chai clearly shows Hong Kong is not lack of investment and economic prosperity, what it needs is equalizing the income. Besides the inner city, the living environment in subdivided flat is even worse. Households living in a 30 square feet room. There is no separate bathroom nor kitchen for each household. They share common toilet. It is unhygienic and cause a potential expose of public health. Most of these subdivided flats locate in Sham Shui Po. Just next to Sham Shui Po, there is a high class private housing estate called Aqua Marine, each flat area is 30 times than the subdivided flat. It demonstrates inequality in this community. Hence, to deal with the disparity in Hong Kong there are two approaches. One is equalizing income another is equalizing opportunity. Equalizing income means narrow the income gap between low and high income group. First, HKSAR government is practicing progressive salary tax, thats means when ones income rise, the proportion of tax payment will increase in a higher percentage than his income. Thus, the wealth gap of tax payers narrowed. Moreover, government will turn the tax revenue to subsidy for the poor who are out of the tax net. Like comprehensive social security assistance scheme. By tax and subsidy, disposable income of poor will rise and lower disposable income of high income group. However, the practice of equalizing income will cause trade off between equity and efficiency. Since government tax the rich and give subsidy to the poor, this improve equality. But this causes a disincentive effect on labour force. Because some may think that being unemployed and get assistance from government is more beneficial than working. As the result, some quit job, the economic pie available for distribution decrease, it is what fall in efficiency. So, in my opinion, equaling income is not suitable. What I support is equalizing opportunity. It means government provide a level playing field for everyone to compete by themselves. Facing a economic restructure in Hong Kong, what we need in the knowledge based economy is specialized skill. Hence, government should subsidize more tertiary education. The outcome is let the grass root mobilize to a higher occupation. Moreover, government can establish law to protect the unprivileged. Like anti-discrimination law, different ethnic can enjoy same right to work in Hong Kong. Local low educated labours, Mainlander, South Asian who come to Hong Kong can earn a living with reasonable treatment. Or regularly review the law, for example minimum wage can be indexed to the inflation rate to ensure the lower class living standard. By equalizing opportunity, this will not cause trade off, can enhance the low income group living standard at the same time. To conclude, the main economic challenge of HKSAR is the disparity of wealth. Hence, the government can lend a helping hand to the lower class by providing them a level playing field to contest in the society. (8045) Reference HKBU Horizon(2012-13) Tipping point: Hong Kong’s alarming income inequality,retrieved from cpro.hkbu.edu.hk/online_pub/nh_1213_2/nh1213_2_p12-17.pdf The World Bank (2013)GDP per capita (current US $) from data.worldbank.org/indicator/NY.GDP.PCAP.CD
Posted on: Fri, 07 Mar 2014 07:56:08 +0000
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