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Economic liberalization with rising segmentation in China's urban labor market

  • Sylvie Démurger

    ()

    (GATE - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - Ecole Normale Supérieure Lettres et Sciences Humaines)

  • Martin Fournier

    ()

    (GATE - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - Ecole Normale Supérieure Lettres et Sciences Humaines)

  • Shi Li

    (School of Economics and Business - Beijing Normal University)

  • Zhong Wei

    (Chinese Academy of Social Sciences - Chinese Academy of Social Sciences)

The massive downsizing of the state-owned sector and the concomitant impressive growth of the private sector at the end of the 1990s have altered the nature of the Chinese labor market. The introduction of market mechanisms has contributed to increasing labor turnover and competitiveness in market wages. Using two urban household surveys for 1995 and 2002, this paper analyzes the evolution of labor market segmentation in urban China, by applying an extended version of Oaxaca-Blinder decomposition methods. During the 7-year period, the sharp increase in real earnings for all workers shows substantial differences across ownership, economic sectors, and regions. We find strong evidence of a multi-tiered labor market along these three major lines and highlight increasing segmentation within each of the three dimensions, the gap between the privileged segments of the labor market and the most competitive segments widening over time.

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Paper provided by HAL in its series Post-Print with number halshs-00353336.

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Date of creation: 2008
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Publication status: Published, Comparative Studies, 2008, 35, Mars, pp. 13-26
Handle: RePEc:hal:journl:halshs-00353336
Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00353336/en/
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