Inter-Industry Wage Differentials : An Increasingly Important Contributor to Urban China Income Inequality
Year: 2009
Type: report
Abstract: How significantly inter-industry wage differentials contribute to rising income inequality is an essential policy issue for transitional economies. Using regression-based inequality decomposition, this paper finds that inter-industrial wage differentials contributed increasingly to income inequality in urban China through 1988, 1995, and 2002, mainly due to rapid income growth in monopolistic industries. Factors such as region, education, ownership, occupation, and holding a second job also contribute increasingly to income inequality, while being employed the whole year and age have decreasing contributions. If China seeks to reduce urban income inequality, removing entry barriers in the labor market and breaking monopoly power in the goods market are essential policy prescriptions.
Authors: Zhao Chen, Ming Lü, Guanghua Wan
Institutions: Fudan University, Asian Development Bank
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1527835062