Labor market dynamics in urban China and the role of the state sector / Shuaizhang Feng (Jinan University and IZA), Naijia Guo (The Chinese University of Hong Kong) ; IZA Institute of Labor Economics
VerfasserFeng, Shuaizhang ; Guo, Naijia
KörperschaftForschungsinstitut zur Zukunft der Arbeit
ErschienenBonn, Germany : IZA Institute of Labor Economics, February 2019
Elektronische Ressource
Umfang1 Online-Ressource (77 Seiten)
SerieDiscussion paper ; no. 12170
 Das Dokument ist öffentlich zugänglich im Rahmen des deutschen Urheberrechts.
Labor market dynamics in urban China and the role of the state sector [0.43 mb]
Verfügbarkeit In meiner Bibliothek
Zusammenfassung (Englisch)

This paper studies the effect of state-owned enterprises on the dynamics of the Chinese urban labor market. Using longitudinal monthly panel data, we document very low dynamics in the labor market, especially in the state sector. We develop and calibrate an equilibrium search and matching model with three differences between the state and the non-state sector: labor productivity, labor adjustment cost, and workers' bargaining power. Counterfactual analysis shows that the lack of dynamics is mainly driven by the strong bargaining power of state-sector workers. Eliminating the differences between the two sectors substantially reduces the unemployment rate and long-term unemployment rate.