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The Supply and Demand Factors Behind the Relative Earnings Increases in Urban China at the Turn of the 21st Century

Hang Gao (), Joseph Marchand () and Tao Song ()
Additional contact information
Hang Gao: University of Alberta, Department of Economics, Postal: 8-14 HM Tory Building, Edmonton, AB, T6G 2H4
Tao Song: University of Alberta, Department of Economics, Postal: 8-14 HM Tory Building, Edmonton, AB, T6G 2H4

No 2011-23, Working Papers from University of Alberta, Department of Economics

Abstract: Real earnings have increased for all demographic and skill groups within China’s urban labor market from the mid-1990s to the early 2000s. This paper analyzes these changes in earnings with respect to the relative supply and demand changes of each of the imperfectly substitutable labor inputs. These movements are found to be consistent with real earnings increases for some of the input groups but are inconsistent for others. This implies that China has transitioned closer to a free labor market from its planned origin. In addition, labor supply is shown to be moving towards a more educated workforce, and firm privatization and international trade are found to play significant roles in determining the labor demand movements.

Keywords: China; earnings; labor demand; labor supply; transitional economies (search for similar items in EconPapers)
JEL-codes: J20 P23 P31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab, nep-lma and nep-tra
Date: 2011-12-01, Revised 2012-09-01
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Journal Article: The Supply and Demand Factors Behind the Relative Earnings Increases in Urban China at the Turn of the 21st Century (2013) Downloads
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Persistent link: http://EconPapers.repec.org/RePEc:ris:albaec:2011_023

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