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Wage Reforms & Work Effort in Chinese State Enterprises

Binsheng Li and Calla Wiemer

No 199308, Working Papers from University of Hawaii at Manoa, Department of Economics

Abstract: Two types of wage reform are analyzed in this study-- bonuses, which were originally paid to workers on an individualized basis out of a fixed enterprise fund, and profit-sharing, which linked worker wages in a more egalitarian fashion to team or enterprise performance. We test for the effectiveness of these reforms in stimulating work effort using a sample of 335 large state industrial enterprises, and conclude that the reforms were indeed successful.

Pages: 31 pages
Date: 1993
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