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Inter-Industry Wage Differentials in China: Evidence from a Correlated Random Effect Model

Author

Listed:
  • Xu Lin

    (Virginia Tech)

  • Wei Xiong

    (Zhongnan University of Economics and Law)

Abstract

We specify a correlated random effect model to study inter-industry wage differentials using a small sample of Chinese firm level panel data. We find workers in real estate industry and computer and software industry enjoy a wage premium, and firms located in western areas pay less. Firm size, and the indicator of CEO also holds the position of general manager are positively related to earnings, while the annual pay for the high-level manager, stock shares held by the general manager, and low human capital endowments of workforce negatively impact wage. We find the profitability of a firm does not affect the average annual pay.

Suggested Citation

  • Xu Lin & Wei Xiong, 2024. "Inter-Industry Wage Differentials in China: Evidence from a Correlated Random Effect Model," Journal of Labor Research, Springer, vol. 45(1), pages 30-57, March.
    • Handle: RePEc:spr:jlabre:v:45:y:2024:i:1:d:10.1007_s12122-023-09352-7
    DOI: 10.1007/s12122-023-09352-7
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    More about this item

    Keywords

    Inter-industry; Wage differential; Correlated random effect; Technology intensive; Capital intensive; Skilled labor;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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