Has China crossed the river? The evolution of wage structure in urban China during reform and retrenchment

Understanding Urban Wage Inequality in China 1988–2008: Evidence from Quantile Analysis

“…We discuss the changes in the returns to both characteristics in turn. Figure 2 confirms the overall rise in the return to education in urban China from 1988 up to 2002 that has been previously reported (Appleton, et al 2005;Zhang, et al 2005). The plotted line for 2002 dominates that for all previous years.…”

“…Falling profitability in the state owned sector led to radical urban reform in 1995, with a mass retrenchment programme 1 . While this increased urban unemployment, it did not prevent large rises in real wages for workers who retained their jobs (Appleton, et al 2005). Throughout the period there has been a rise in the importance of privately enterprise, whether through new entry of privately owned firms or through changes in the ownership of state owned enterprises (for example, moving to mixed ownership by listing on the stock exchange).…”

“…There have been many studies of earnings and inequality in China during this eventful period (see Appleton et al, 2005). However, most analysis of wages has used conventional regression analysis, implicitly focusing on wage differentials at the mean (or, since the dependent variable is typically the log wage, the median).…”

Identity, Inequality, and Happiness: Evidence from Urban China

“…Political identity, measured as whether the individual is a Communist Party member, significantly increases happiness, perhaps because party membership may bring more political or social capital. Previous studies have confirmed that Party identity brings higher income (Appleton et al, 2005;Knight and Yueh, 2002;Li, Lu and Sato, 2009); however, even when we control the log household income, Party identity still leads to greater happiness because of non-monetary benefits. People who optimistically expect that they will have a big or small increase in income after five years are much happier, and big expectations lead to 3 times the increase in happiness scores than small expectations.…”

Poverty and Low Earnings in the Developing World

“…(Workers who are comparable in this way are said to be "observationally equivalent.") When such controlled studies have been doneexamples are Appleton, Song, and Xia (2005) for China, Glinskaya and Lokshin (2005) and Hasan and Magsombol (2005) for India, and Stroll and Thornton (2002) for several African countries -wage differentials for observationally equivalent workers, often very large ones, have been found. Such evidence is consistent with labor market segmentation but can and has been challenged by analysts who contend that the earnings differentials are found because workers who look comparable to researchers have unobservable characteristics that make them different from one another in fact (Rosenzweig, 1988).…”