The Declining Share of Agricultural Employment in the People’s Republic of China: How Fast?

Jesus Felipe (), Connie Bayudan-Dacuycuy and Matteo Lanzafame

No 419, ADB Economics Working Paper Series from Asian Development Bank

Abstract: From 1962 to 2013, the People’s Republic of China’s (PRC’s)agricultural employment share declined from 82% to 31%. The transfer of workers out of low-productivity agriculture is a fundamental pillar of the PRC’s aspirations to progress and eventually become a high-income economy. We hypothesize that the drivers of this decline have been the increase in income per capita, industrial value added, foreign direct investment, and domestic credit. We use an Autoregressive Distributed Lag Model to test the strong exogeneity of the regressors so that we can use it for forecasting. Results indicate that the share of employment in agriculture in the PRC will decline to about 24% by 2020, the end of the 13th Five-Year Plan (2016–2020). We also estimate that the PRC’s employment share will reach 5%, the share observed in today’s rich economies, by 2042–2048.

Keywords: agricultural employment; People’s Republic of China; structural transformation (search for similar items in EconPapers)
JEL-codes: O13 O53 Q10 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2014-11-01
New Economics Papers: this item is included in nep-cna and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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