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Why rapid urbanization process cannot improve employment absorption capacity of service industry in China—also on the interactive mode innovation between service industry development with urbanization under the background of transformation and upgrading

Author

Listed:
  • Shi-hong Zeng

    (Hunan University of Science and Technology
    CASS)

  • Jie-chang Xia

    (CASS)

Abstract

Background China is experiencing rapid urbanization and service industrial developement. Methods In this paper, the relationship between urbanization and service employment is studied by using mathematical model and econometric test method. Results This paper documents that there is a significant positive correlation between rapid urbanization process and services absorbing employment ability by the regression result using time-series data since China's reform and opening up. China's urbanization process cannot become the Granger causes that service employment absorption capacity to improve by analyzing the SVAR model and Granger causality test. Conclusions So, Chinese urbanization patterns should transform from rapid industry park construction to increased service employment density of city.

Suggested Citation

  • Shi-hong Zeng & Jie-chang Xia, 2016. "Why rapid urbanization process cannot improve employment absorption capacity of service industry in China—also on the interactive mode innovation between service industry development with urbanization," China Finance and Economic Review, Springer, vol. 4(1), pages 1-12, December.
    • Handle: RePEc:spr:chfecr:v:4:y:2016:i:1:d:10.1186_s40589-016-0033-z
    DOI: 10.1186/s40589-016-0033-z
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    References listed on IDEAS

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    1. Francisco J. Buera & Joseph P. Kaboski, 2012. "The Rise of the Service Economy," American Economic Review, American Economic Association, vol. 102(6), pages 2540-2569, October.
    2. Guy Michaels & Ferdinand Rauch & Stephen J. Redding, 2012. "Urbanization and Structural Transformation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(2), pages 535-586.
    3. David Audretsch & Oliver Falck & Stephan Heblich, 2011. "Who’s got the aces up his sleeve? Functional specialization of cities and entrepreneurship," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(3), pages 621-636, June.
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    Cited by:

    1. Dio Caisar DARMA & Jati KASUMA & Muhammad IKBAL, 2020. "Employment Absorption: Elasticity in the Industry and Services Sector in Indonesia," Management and Economics Review, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 5(1), pages 125-135, June.

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