Exports, FDI, Growth Of Small Rural Enterprises And Employment In China
Xiaolan Fu and
Working Papers from Centre for Business Research, University of Cambridge
This paper analyses the growth of employment in China during the post reform period. It argues that the Chinese experience with export-led growth provides an excellent example of the phenomenon of a vent for surplus productive capacity provided by exports, identified by Adam Smith in the Wealth of Nations and elaborated by Hla Myint. The paper extends the Smith-Myint model of ‘vent-for-surplus’ productive capacity to ‘vent-for-surplus’ resources by allowing foreign investment inflows. The ‘vent-for-surplus’ effect of exports on employment growth is examined in a dynamic labour demand framework for a panel of township and village enterprises (TVEs) in China.
Keywords: exports; foreign direct investment; small and medium-enterprises; employment (search for similar items in EconPapers)
JEL-codes: F16 F21 (search for similar items in EconPapers)
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