Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/69387
Authors: 
Xia, Qingjie
Song, Lina
Li, Shi
Appleton, Simon
Year of Publication: 
2013
Series/Report no.: 
Discussion Paper Series, Forschungsinstitut zur Zukunft der Arbeit 7142
Abstract: 
This paper examines the effects of state sector domination on wage inequality in urban China. Using Chinese Household Income Project surveys, we conduct two exercises: with quantile regression analysis, we identify wage gaps across the distribution and over time; and we employ the Machado and Mata (2005) decomposition to investigate how urban wage inequality was affected by the changes in wage structure and employment share of the state sector. We find that since the radical state sector reforms designed to reduce over-staffing and improve efficiency since the late 1990s, urban wage gaps were narrowed due to the reduction of employment share in the state sector; the wage premium of the state sector in comparison with the non-state sector increased significantly; and changes in the wage structure of the labour market caused the rise in urban wage inequality.
Subjects: 
China
state sector
wage inequality
quantile regression
counterfactual analysis
JEL: 
J31
J42
O15
P23
Document Type: 
Working Paper

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