Arbeitspapier

Economic reform, education expansion, and earnings inequality for urban males in China, 1988 - 2007

In the past 20 years the average real earnings of Chinese urban male workers have increased by 350 per cent. Accompanying this unprecedented growth is a considerable increase in earnings inequality. Between 1988 and 2007 the variance of log earnings increased from 0.27 to 0.48, a 78 per cent increase. Using a unique set of repeated cross-sectional data this paper examines the causes of this increase in earnings inequality. We find that the major changes occurred in the 1990s when the labour market moved from a centrally planned system to a market oriented system. The decomposition exercise conducted in the paper identifies the factor that drives the significant increase in the earnings variance in the 1990s to be an increase in the within-education-experience cell residual variances. Such an increase may be explained mainly by the increase in the price of unobserved skills. When an economy shifts from an administratively determined wage system to a market-oriented one, rewards to both observed and unobserved skills increase. The turn of the century saw a slowing down of the reward to both the observed and unobserved skills, due largely to the college expansion program that occurred at the end of the 1990s.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 4919

Klassifikation
Wirtschaft
Wage Level and Structure; Wage Differentials
Thema
Earnings inequality
China
Lohnstruktur
Einkommensverteilung
Soziale Ungleichheit
Übergangswirtschaft
Bildungsreform
Städtischer Arbeitsmarkt
China

Ereignis
Geistige Schöpfung
(wer)
Meng, Xin
Shen, Kailing
Xue, Sen
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2010

Handle
Letzte Aktualisierung
10.03.2025, 11:44 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Meng, Xin
  • Shen, Kailing
  • Xue, Sen
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2010

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