Abstract: By making use of the grouped data of urban-rural income from 1985 to 2015, this paper estimates the degree of polarization of Chinese residents’ income distribution based on the assumption of the generalized Beta II distribution and in the identity-alienation framework. The findings show that the degree of polarization was generally rising from 1985 to 2009, and then it has been declining since 2009. Among which, the degree of identity was declining from 1985 to 2015, while the degree of alienation was rising from 1985 to 2009, and has been declining since 2009. The results of further analysis based on stepwise regression and co-integration regression show that such factors as industrial structure, capital formation rate, inter-industrial wages inequality, opening degree and changes of bank loan scales have significant positive effect on the degree of polarization, while the enrollment rate of junior high school, the changes of employment structure and inflation have significant negative impact. Among them, the opening degree, the enrollment rate of junior high school, the inter-industrial wage inequality and the capital formation have rather significant impacts on the degree of polarization.

Key words: income distribution; degree of polarization; generalized Beta II distribution; stepwise regression; co-integration regression