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Foreign direct investment and gendered wages in urban China

Author

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  • Elissa Braunstein
  • Mark Brenner

Abstract

This paper documents the changing impact of foreign direct investment (FDI) on gendered wages in urban China. Combining household survey data from 1995 and 2002 with province-level macro-data, the paper finds that FDI as a proportion of investment has a sizable and statistically significant positive effect on both female and male wages in both years. In 1995, women experienced larger gains from FDI than men, but those gender-based advantages had reversed by 2002, with men experiencing larger wage gains from FDI than women. The paper argues that these results reflect the shift of foreign-invested enterprises to higher productivity and more domestically oriented production, a shift that interacts with gender-based employment segregation to more greatly advantage workers in male-dominated than female-dominated industries. These findings indicate that FDI can have considerable structural effects on economies that reach beyond the particular workers and firms linked to foreign investors.

Suggested Citation

  • Elissa Braunstein & Mark Brenner, 2007. "Foreign direct investment and gendered wages in urban China," Feminist Economics, Taylor & Francis Journals, vol. 13(3-4), pages 213-237.
  • Handle: RePEc:taf:femeco:v:13:y:2007:i:3-4:p:213-237 DOI: 10.1080/13545700701439432
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Latorre, María C., 2016. "A CGE Analysis of the Impact of Foreign Direct Investment and Tariff Reform on Female and Male Workers in Tanzania," World Development, Elsevier, vol. 77(C), pages 346-366.
    2. Dalgıç, Başak & Fazlıoğlu, Burcu & Varol İyidoğan, Pelin, 2016. "Doğrudan Yabancı Yatırımlar Kadın İstihdamını Artırır mı? Türkiye’de Hizmetler Sektörüne Yakından Bakış
      [Does Foreign Direct Investment Bring Jobs to Women? A Closer Look to Turkish Services Indust
      ," MPRA Paper 70790, University Library of Munich, Germany.
    3. Somasree Poddar & Sarbajit Chaudhuri, 2016. "Economic Reforms and Gender-Based Wage Inequality in the Presence of Factor Market Distortions," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 14(2), pages 301-321, December.
    4. Priit Vahter & Jaan Masso, 2018. "The Contribution Of Multinationals To Wage Inequality: Foreign Ownership And The Gender Pay Gap," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 106, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    5. Neumayer, Eric & de Soysa, Indra, 2011. "Globalization and the Empowerment of Women: An Analysis of Spatial Dependence via Trade and Foreign Direct Investment," World Development, Elsevier, vol. 39(7), pages 1065-1075, July.
    6. Tatli, Ahu & Vassilopoulou, Joana & Özbilgin, Mustafa, 2013. "An unrequited affinity between talent shortages and untapped female potential: The relevance of gender quotas for talent management in high growth potential economies of the Asia Pacific region," International Business Review, Elsevier, pages 539-553.
    7. repec:ilo:ilowps:484309 is not listed on IDEAS
    8. Mukhopadhyay, Ujjaini & Chaudhuri, Sarbajit, 2011. "Economic liberalization, gender wage inequality and welfare – a theoretical analysis," MPRA Paper 32954, University Library of Munich, Germany.
    9. Gustafsson, Björn & Sai, Ding, 2009. "Rank, income and income inequality in urban China," China Economic Review, Elsevier, vol. 20(3), pages 497-507, September.
    10. Chen, Zhihong & Ge, Ying & Lai, Huiwen & Wan, Chi, 2013. "Globalization and Gender Wage Inequality in China," World Development, Elsevier, vol. 44(C), pages 256-266.
    11. Goulding, Kristine., 2013. "Gender dimensions of national employment policies : a 24-country study," ILO Working Papers 994843093402676, International Labour Organization.
    12. Seo-Young Cho, 2011. "Integrating Equality - Globalization, Women’s Rights, Son Preference and Human Trafficking," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 73, Courant Research Centre PEG.
    13. Goulding, Kristine., 2013. "Gender dimensions of national employment policies : a 24-country study," ILO Working Papers 994835833402676, International Labour Organization.
    14. Chen, Zhihong & Ge, Ying & Lai, Huiwen, 2011. "Foreign Direct Investment and Wage Inequality: Evidence from China," World Development, Elsevier, vol. 39(8), pages 1322-1332, August.
    15. Elissa Braunstein, 2011. "Foreign Direct Investment and Development from a Gender Perspective," Chapters,in: The Handbook of Globalisation, Second Edition, chapter 10 Edward Elgar Publishing.
    16. Dong, Xiao-yuan & Zhang, Liqin, 2009. "Economic transition and gender differentials in wages and productivity: Evidence from Chinese manufacturing enterprises," Journal of Development Economics, Elsevier, pages 144-156.
    17. repec:ilo:ilowps:483583 is not listed on IDEAS
    18. Gustafsson, Björn Anders & Sai, Ding, 2008. "Rank, Income and Income Inequality in Urban China," IZA Discussion Papers 3843, Institute for the Study of Labor (IZA).
    19. Hung-Yang Lin, 2013. "Benchmarking Policy Inputs and Social Outputs of Retirement Payment Schemes: China, Hong Kong, Singapore and Taiwan Compared With the Three Worlds," International Journal of Asian Social Science, Asian Economic and Social Society, vol. 3(6), pages 1328-1344, June.

    More about this item

    Keywords

    China; earnings differentials; foreign direct investment; trade liberalization; JEL Codes: F21; J7; O53;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • J7 - Labor and Demographic Economics - - Labor Discrimination
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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