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Are Chinese Workers Paid the Correct Wages? Measuring Wage Underpayment in the Chinese Industrial Sector, 2005-2010

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  • Zhun Xu
  • Ying Chen
  • Minqi Li

Abstract

This paper examines the labor compensations of the Chinese industrial sector for the period 2005-2010. We find that both the state owned enterprises and the non-domestic enterprises pay more than the living wage. But the domestic private enterprises pay substantially less than the living wage. We also find that all types of Chinese industrial enterprises pay the workers with wages that are substantially less than their marginal product of labor.

Suggested Citation

  • Zhun Xu & Ying Chen & Minqi Li, 2015. "Are Chinese Workers Paid the Correct Wages? Measuring Wage Underpayment in the Chinese Industrial Sector, 2005-2010," Review of Radical Political Economics, Union for Radical Political Economics, vol. 47(3), pages 446-459, September.
    • Handle: RePEc:sae:reorpe:v:47:y:2015:i:3:p:446-459
    DOI: 10.1177/0486613414542780
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    References listed on IDEAS

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    1. Dennis Tao Yang & Hao Zhou, 1999. "Rural-urban disparity and sectoral labour allocation in China," Journal of Development Studies, Taylor & Francis Journals, vol. 35(3), pages 105-133.
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    4. Gregory C. Chow, 1993. "Capital Formation and Economic Growth in China," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 809-842.
    5. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    6. Louis Kuijs & Tao Wang, 2006. "China's Pattern of Growth: Moving to Sustainability and Reducing Inequality," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 14(1), pages 1-14, February.
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    Cited by:

    1. Cheng, Zhiming, 2022. "Communist Party branch and labour rights: Evidence from Chinese entrepreneurs," China Economic Review, Elsevier, vol. 71(C).
    2. Muriel Périsse & Clément Séhier, 2019. "Analysing wages and labour institutions in China: An unfinished transition," The Economic and Labour Relations Review, , vol. 30(3), pages 400-421, September.
    3. Chung-Khain Wye & Elya Nabila Abdul Bahri, 2021. "How does employment respond to minimum wage adjustment in China?," The Economic and Labour Relations Review, , vol. 32(1), pages 90-114, March.

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    More about this item

    Keywords

    living wage; China; marginal product of labor;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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