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Understanding Urban Wage Inequality in China 1988-2008: Evidence from Quantile Analysis

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Listed:
  • Appleton, Simon

    () (University of Nottingham)

  • Song, Lina

    () (University of Nottingham)

  • Xia, Qingjie

    () (Peking University)

Abstract

This paper examines change in wage gaps in urban China by estimating quantile regressions on CHIPS data. It applies the Machado and Mata (2005) decomposition, finding sharp increases in inequality from 1988 to 1995 and from 2002 to 2008 largely due to changes in the wage structure. The analysis reports how the returns to education and experience vary across wage quantiles, along with wage differentials by sex and party membership. The role of industrial structure, ownership reform and occupational change are also estimated. In the recent period, 2002 to 2008, falls in the returns to education and experience have been equalising. However, changes in every other category of observed wage differential – by sex, occupation, ownership, industrial sector and province – have served to widened inequality. The gender gap continued to rise, as did the gap between white collar and blue collar workers, and between manufacturing and most other industrial sectors.

Suggested Citation

  • Appleton, Simon & Song, Lina & Xia, Qingjie, 2012. "Understanding Urban Wage Inequality in China 1988-2008: Evidence from Quantile Analysis," IZA Discussion Papers 7101, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp7101
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    References listed on IDEAS

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    Cited by:

    1. Hare, Denise, 2016. "What accounts for the decline in labor force participation among married women in urban China, 1991–2011?," China Economic Review, Elsevier, vol. 38(C), pages 251-266.
    2. Mah Jai S., 2015. "The Effect of Foreign Direct Investment Inflows on Income Inequality: Evidence from China," Global Economy Journal, De Gruyter, vol. 15(4), pages 443-453, December.
    3. Fang Yang & Shiying Pan & Xin Yao, 2016. "Regional Convergence and Sustainable Development in China," Sustainability, MDPI, Open Access Journal, vol. 8(2), pages 1-15, January.
    4. Gustafsson, Björn & Li, Shi & Nivorozhkina, Ludmila & Wan, Haiyuan, 2015. "Yuan and Roubles: Comparing wage determination in urban China and Russia at the beginning of the new millennium," China Economic Review, Elsevier, vol. 35(C), pages 248-265.
    5. Chao, Chi-Chur & Nabin, Munirul & Nguyen, Xuan & Sgro, Pasquale M., 2016. "Wage inequality and welfare in developing countries: Privatization and reforms in the short and long run," International Review of Economics & Finance, Elsevier, vol. 42(C), pages 474-483.
    6. Chris Milner & Juliane Scheffel & Feicheng Wang, 2016. "Globalisation and Inter-Industry Wage Differentials in China," Discussion Papers 2016-02, University of Nottingham, GEP.
    7. Boffy-Ramirez, Ernest & Moon, Soojae, 2017. "The Role of China's Household Registration System in the Urban-Rural Income Differential," IZA Discussion Papers 11022, Institute for the Study of Labor (IZA).
    8. Euler, Michael & Krishna, Vijesh & Schwarze, Stefan & Siregar, Hermanto & Qaim, Matin, 2017. "Oil Palm Adoption, Household Welfare, and Nutrition Among Smallholder Farmers in Indonesia," World Development, Elsevier, vol. 93(C), pages 219-235.
    9. repec:wsi:serxxx:v:62:y:2017:i:02:n:s021759081550071x is not listed on IDEAS
    10. Huang, Qiong & Chand, Satish, 2015. "Spatial spillovers of regional wages: Evidence from Chinese provinces," China Economic Review, Elsevier, vol. 32(C), pages 97-109.
    11. Kim, Sung won & Kim, Edward J. & Wagaman, Amy & Fong, Vanessa L., 2017. "A longitudinal mixed methods study of parents’ socioeconomic status and children’s educational attainment in Dalian City, China," International Journal of Educational Development, Elsevier, vol. 52(C), pages 111-121.

    More about this item

    Keywords

    China; labour; wages; quantile regression; inequality;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • P23 - Economic Systems - - Socialist Systems and Transition Economies - - - Factor and Product Markets; Industry Studies; Population

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