Changes in Job Structure and Rising Wage Inequality in Urban China, 1995−2007

Changes in Job Structure and Rising Wage Inequality in Urban China, 1995−2007 We use household surveys from 1995, 2002, and 2007 to examine how changes in job structure contributed to China’s rising urban wage inequality, considering three job characteristics: occupation, industry, and firm ownership. The explanatory power of job structure for wage inequality increased between 1995 and 2007. Both the change in relative number of jobs (composition effect) and the change in between-job and within-job wage gaps (price effect) contributed to rising wage inequality. Price effect was the major contributor, whereas composition effect played a larger role in the 1995–2002 period than in the 2002–2007 period, and at the lower-half distribution. Between-job inequality played a major role in the first period, and within-job inequality played a major role in the second period. Our results suggest that both technological change and institutional features influence job structure and wage inequality. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Frontiers of Economics in China Brill

Changes in Job Structure and Rising Wage Inequality in Urban China, 1995−2007

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Publisher
Brill
Copyright
Copyright 2012 by Koninklijke Brill NV, Leiden, The Netherlands
ISSN
1673-3444
eISSN
1673-3568
D.O.I.
10.3868/s060-001-012-0014-7
Publisher site
See Article on Publisher Site

Abstract

We use household surveys from 1995, 2002, and 2007 to examine how changes in job structure contributed to China’s rising urban wage inequality, considering three job characteristics: occupation, industry, and firm ownership. The explanatory power of job structure for wage inequality increased between 1995 and 2007. Both the change in relative number of jobs (composition effect) and the change in between-job and within-job wage gaps (price effect) contributed to rising wage inequality. Price effect was the major contributor, whereas composition effect played a larger role in the 1995–2002 period than in the 2002–2007 period, and at the lower-half distribution. Between-job inequality played a major role in the first period, and within-job inequality played a major role in the second period. Our results suggest that both technological change and institutional features influence job structure and wage inequality.

Journal

Frontiers of Economics in ChinaBrill

Published: Jan 1, 2012

Keywords: job structure; wage inequality; urban China; decomposition

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