Changes in China's Wage Structure

Suqin Ge and Dennis Yang

No 6492, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using a national sample of Urban Household Surveys, we document several profound changes in China's wage structure during a period of rapid economic growth. Between 1992 and 2007, the average real wage increased by 202 percent, accompanied by a sharp rise in wage inequality. Decomposition analysis reveals 80 percent of this wage growth to be attributable to higher pay for basic labor, rising returns to human capital, and increases in the state-sector wage premium. Employing an aggregate production function framework, we account for the sources of wage growth and wage inequality in the face of globalization and economic transition. We find capital accumulation, skill-biased technological change, and export expansion to be the major forces behind the evolving wage structure in China.

Keywords: trade expansion; wage growth; technological change; wage inequality; capital accumulation; wage premium; China (search for similar items in EconPapers)
JEL-codes: E24 J31 O40 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2012-04
New Economics Papers: this item is included in nep-dev, nep-fdg, nep-lab, nep-lma, nep-ltv and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published - published in: Journal of European Economic Association, 2014, 12 (2), 300-336

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Related works:
Journal Article: CHANGES IN CHINA'S WAGE STRUCTURE (2014)
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