Global Value Chain Participation, Employment Structure, and Urban–Rural Income Gap in the Context of Sustainable Development

Abstract

Currently, the trend of globalization is evident, and global value chain participation has had a significant impact on the urban–rural income gap in China. This article takes sustainable development as the background and constructs a theoretical mechanism for the impact of global value chain participation on the urban–rural income gap and uses a two-way fixed effects model to empirically test data from 30 provinces in China from 2005 to 2014. Research finds that global value chain participation significantly widens the urban–rural income gap. Compared to the central and western regions, the participation of the eastern region in the global value chain has a more significant effect on widening the urban–rural income gap. Further research has found that employment structure plays a partial mediating role in the process of global value chain participation in widening the urban–rural income gap. The factor endowment structure and industrial structure upgrading can significantly strengthen the mechanism of global value chain participation in optimizing the employment structure. This article’s research findings have significant practical implications for reducing the income gap between urban and rural areas and fostering sustainable development in both.