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How are Wages set in Beijing?

Author

Listed:
  • José De Sousa
  • Sandra Poncet
Abstract
China's export performance over the past fifteen years has been phenomenal. Is this performance going to last? Wages are rising rapidly but a population in excess of one billion represents a large reservoir of labor. Firms in export-intensive provinces may draw on this reservoir to increase competition in their labor market and keep wages low for many years to come. We develop a wage equation from a New Economic Geography model to capture the upward pressure from national and international demand and downward pressure from migration. Using panel data at the province level, we find that migration has moderately slowed down Chinese wage increase over the period 1995-2007.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • José De Sousa & Sandra Poncet, 2007. "How are Wages set in Beijing?," Working Papers 2007-13, CEPII research center.
    • Handle: RePEc:cii:cepidt:2007-13
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    More about this item

    Keywords

    Wages; immigration; economic geography;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F15 - International Economics - - Trade - - - Economic Integration
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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