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How Productive is Chinese Labour? The Contributions of Labour Market Reforms, Competition and Globalisation

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  • Linda Yueh
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    Abstract

    Productivity advances drive long-run economic growth, and a crucial factor is labour productivity improvements.� The productivity of labour in China was marginally relevant in the pre-1978 period, but the picture has changed dramatically in the reform period due to numerous labour market reforms as well as radical changes in ownership structure whereby the dominance of state-owned enterprises has given way to the rise of private sector firms and globalisation.� Using a national firm-level panel data set from 2000 to 2005, this paper hypothesises that labour productivity has improved as a result of labour market reforms, increased competition, and greater opening to the global economy, and finds that all of these factors to be important.

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    Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 418.

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    Date of creation: 01 Dec 2008
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    Handle: RePEc:oxf:wpaper:418

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    Keywords: Labour Productivity; China; Economic Reform;

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    1. R Blundell & Steven Bond, . "Initial conditions and moment restrictions in dynamic panel data model," Economics Papers W14&104., Economics Group, Nuffield College, University of Oxford.
    2. Linda Y. Yueh, 2004. "Wage Reforms in China During the 1990s," Asian Economic Journal, East Asian Economic Association, East Asian Economic Association, vol. 18(2), pages 149-164, 06.
    3. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, Econometric Society, vol. 71(6), pages 1695-1725, November.
    4. Gary H. Jefferson & Thomas G. Rawski, 1994. "Enterprise Reform in Chinese Industry," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 8(2), pages 47-70, Spring.
    5. Sofronis Clerides & Saul Lach & James Tybout, 1996. "Is "Learning-by-Exporting" Important? Micro-Dynamic Evidence from Colombia, Mexico and Morocco," NBER Working Papers 5715, National Bureau of Economic Research, Inc.
    6. John S. Earle & Saul Estrin, . "Privatization, Competition, and Budget Constraints: Disciplining Enterprises in Russia," Upjohn Working Papers and Journal Articles, W.E. Upjohn Institute for Employment Research jse20032, W.E. Upjohn Institute for Employment Research.
    7. Magnus Blomstrom & Fredrik Sjoholm, 1998. "Technology Transfer and Spillovers? Does Local Participation with Multinationals Matter?," NBER Working Papers 6816, National Bureau of Economic Research, Inc.
    8. Wagner, Joachim, 2005. "Exports and Productivity : A survey of the evidence from firm level data," HWWA Discussion Papers 319, Hamburg Institute of International Economics (HWWA).
    9. Jefferson, Gary H. & Su, Jian, 2006. "Privatization and restructuring in China: Evidence from shareholding ownership, 1995-2001," Journal of Comparative Economics, Elsevier, vol. 34(1), pages 146-166, March.
    10. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, Taylor & Francis Journals, vol. 19(3), pages 321-340.
    11. Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output Per Worker Than Others?," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 114(1), pages 83-116, February.
    12. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, Econometric Society, vol. 50(4), pages 1029-54, July.
    13. Knight, John & Yueh, Linda, 2004. "Job mobility of residents and migrants in urban China," Journal of Comparative Economics, Elsevier, vol. 32(4), pages 637-660, December.
    14. Jefferson, Gary H. & Rawski, Thomas G. & Li, Wang & Yuxin, Zheng, 2000. "Ownership, Productivity Change, and Financial Performance in Chinese Industry," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 786-813, December.
    15. Windmeijer, Frank, 2005. "A finite sample correction for the variance of linear efficient two-step GMM estimators," Journal of Econometrics, Elsevier, Elsevier, vol. 126(1), pages 25-51, May.
    16. Gary H. Jefferson & Albert G. Z. Hu & Jian Su, 2006. "The Sources and Sustainability of China's Economic Growth," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(2), pages 1-60.
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