Trade liberalisation, market competition and wage inequality in China's manufacturing sector

Sajid Anwar; S Sun

doi:10.1016/j.econmod.2012.03.013

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Trade liberalisation, market competition and wage inequality in China's manufacturing sector

Journal article

Open access

Peer reviewed

Trade liberalisation, market competition and wage inequality in China's manufacturing sector

Sajid Anwar and S Sun

Economic Modelling, Vol.29(4), pp.1268-1277

2012

DOI: https://doi.org/10.1016/j.econmod.2012.03.013

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Abstract

wage inequality

trade liberalisation

product market competition

China

Economic reforms of the late 1980s have contributed to rapid economic growth in China. While the overall standard of living has improved, economic growth has also resulted in an increase in income inequality. Rising income inequality can increase social tensions that can impede further economic growth. By making use of firm level panel data, this paper focuses on the impact of increased market competition and trade liberalisation on skilled-unskilled wage inequality in China's manufacturing sector. A theoretical model is used to argue that trade liberalisation and market competition can affect skilled-unskilled wage inequality. Based on this result, an econometric model is specified. The empirical analysis presented in this paper shows that increased trade liberalisation has contributed to an increase in skilled-unskilled wage inequality in China's manufacturing sector. However, increase in market competition has the opposite effect.

Details

Title: Trade liberalisation, market competition and wage inequality in China's manufacturing sector
Authors: Sajid Anwar (Author) - University of the Sunshine Coast - Faculty of Arts and Business
S Sun (Author) - James Cook University
Publication details: Economic Modelling, Vol.29(4), pp.1268-1277
Publisher: Elsevier BV, North-Holland
Date published: 2012
DOI: 10.1016/j.econmod.2012.03.013
ISSN: 0264-9993
Copyright note: Copyright © 2012. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/
Organisation Unit: School of Business and Creative Industries; Indigenous and Transcultural Research Centre; University of the Sunshine Coast, Queensland; USC Business School - Legacy
Language: English
Record Identifier: 99449847202621
Output Type: Journal article

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