Lakshmi Iyer, Xin Meng, Nancy Qian, Xiaoxue Zhao. 2013. Economic transition and private-sector labor demand evidence from urban China. Working Paper 19733. National Bureau of Economic Research
ABSTRACT:This paper studies the policy determinants of economic transition and estimates the demand for labor in the infant private sector in urban China. We show that a reform that untied access to housing in urban areas from working for the state sector accounts for more than a quarter of the overall increase in labor supply to the private sector during 1986-2005. Using the reform to instrument for private-sector labor supply, we find that private-sector labor demand is very elastic. We provide suggestive evidence that the reform equalized wages across sectors and reduced private-sector rents.
摘要：本文研究经济转型的政策决定因素并对中国城市地区尚处于起步阶段的私营部门的劳动力需求进行估计。我们发现城镇住房改革从国有部门中释放了劳动力，而这部分劳动力在1986 – 2005年间的劳动力供给增长总额中比私营部门多占了超过25%。运用改革私营部门劳动力供给的工具，我们发现私营部门的劳动需求非常有弹性。我们得出了具有启发性的证据说明改革使部门间工资均等化并减少了私营部门的租金。
数据来源：China’s Urban Household Income and Expenditure Surveys(UHIES)；
Province-level newspapers in the National Library achives in Beijing
Conclusion:The goal of this study is to make progress on two questions. What are effective policies for gradually transioning into the private sector? what is the labor demand elasticity in the new private sector during economic transition? Using the staggered timing of the Chinese urban housing reform, we show that untying housing benefits from state-sector employment accounts for 30% of the increase in private sector employment in Chinese cities during 1986-2005.By exploiting the plausibly exogenous variation in sector-specific labor supply induced by the urban housing reforms, we find that increasing private-sector labor supply by 10% reduce wages by 1.8 to 3.2%:the implied labor demand elasticities range from 3.1 to 5.5.
Our results have several interesting implications. First,finding an elastic labor demand implies that capital and technology are quite mobile across sectors in urban China.Second and more importantly,it suggests that the private sector,even in its infancy,can absorb a significant amount of labor without large wage declines.However,the projected magnitudes of labor movement into the Chinese private sector are so large that they still imply drastic private-sector wage reductions,if capital and technology movements remain at the same rate as in our data.Thus,to minimize wage reductions,Chinese policy makers may want to consider policies that increase the mobility of other factors of production into the private sector.
Finally,the evidence that increasing labor mobility reduces rents earned by private-sector workers suggest that transition may be very unpopular with certain segments of the population despite its potential welfare benefits.This is important for policy makers to take into account from a political economy perspective.
In extrapolating our results to other contexts,it is important to note that the magnitude of the estimates are specific to the context of this study. In particular,relative to other transitioning economies,China experienced little political and social upheaval and steady economic growth.Nevertheless,the insights that reducing benefits tied to state-sector employment is an effective policy for gradually releasing workers from the state sector,that large movements into the private sector should ideally be accompanied by policies that facilitate the movement of other factors of production and that increased mobility can dissipate rents for workers initially in the private sector are generalizable.
Our study has two important implications for futher research on economic transition.First,the results suggest that understanding the determinants and the speed of the flow of the factors of production into private sector is an important avenue for future research.Second,and more generally,most past empirical studies of economic transition have been descriptive or focused on cross-country comparison.Our study provide an example of how policy experiments and newly availably micro-data from transitioning economics can be used to provide well-identified estimates and enhance our understanding of the transition process.
结论:本论文的目的是在两个问题上取得进展：逐渐把劳动力转到私营部门的有效政策是什么？处于经济转型期的新私营部门的劳动需求弹性是多少？通过分析中国城镇住房改革的不同阶段，我们发现从国营部门就业中放开住房福利导致1986 - 2005年期间中国城市私营部门就业提高30%。通过利用由城镇住房改革引起的行业劳动力供给的外生变化，我们发现私营部门的劳动力供给增加10%则工资减少1.8%-3.2%：这意味着劳动力需求弹性范围是从3.1到5.5。