Rural‐urban disparity and sectoral labour allocation in China
Year: 1999
Type: article
Abstract: This study examines China's rural‐urban segmentation and its causes in the context of economic reforms. Household survey and aggregate data indicate a V‐shaped process in which rural‐urban consumption and income differentials decreased between 1978 and 1985, but then have continually increased to historically high levels. This sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban/state‐owned industries than in rural industries and agriculture. To explain the V‐shaped change, we argue that the precedent of successful rural reforms raised farmers’ relative earnings, but the remaining obstacles to an efficient sectoral allocation of labour have prevented China from eliminating dualism. Recent financial policies consisting of urban price subsidies and increased investment credits have also had influential distribution effects that are biased against the rural sector.
Authors: Dennis Tao Yang, Hao Zhou
Institution: Duke University
Language: English
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2138150396