Presenter: Chunbing
Xing
Topic: The
Regional Distribution of Skill Premia in Urban China and Implications for Growth
and Inequality
Time: 16:00-17:30,
May 7th, 2013
Location: 608
Acedamic Hall
Abstract We
document and discuss the implications of a sharp increase in the regional
dispersion of skill premia in China in recent years. This has previously been
little noted or discussed. We use three urban household surveys for 1995, 2002,
and 2007 and estimate skill premia at provincial and city levels. Results show
an increase in the skill premium across all regions between 1995 and 2002, but
only coastal regions show significant increases in skill premia between 2002 and
2007. For 2007, coastal regions also have much higher within-region wage
inequality, and this contributes more to overall urban wage inequality than
within-region inequality of non-coastal regions. Using a fixed effects model at
city level, we find that ownership restructuring is a significant factor in
driving up skill premia during the first period (1995 to 2002), and that the
ongoing process of China’s integration into the global economy plays a
significant and regionally concentrated role in the second period (2002 to
2007). Finally, we suggest that the Hukou registration system may prevent
skilled labour from moving to high skill premium regions and retard
mobility-induced reductions in inequality. This effect may also retard even
higher growth.
