Graduation Year

Spring 2012

Document Type

Open Access Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

Serkan Ozbeklik

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Terms of Use for work posted in Scholarship@Claremont.

Rights Information

© 2012 Maira T. Mercado

Abstract

This study seeks to analyze the changes in the effects of determinants of earnings inequality and their labor market implications in urban China from 1988 to 2002. It analyzes urban individual data from the 1988, 1995, and 2002 surveys of the China Household Income Project by studying its inequality measures and summary statistics, and by conducting an ordinary least squares regression, quantile regression, and regression-based decomposition analysis. It finds that the labor market has indeed been rewarding human capital variables, in which age and work experience, which are related to seniority, have been decreasing in their contribution to earnings inequality, whereas education and skill-based occupation have been increasing their contributions to earnings inequality. In addition, the labor market has become more discriminatory in terms of gender, which has increased its contribution to earnings inequality, and less discriminatory in terms of minority status and Communist party membership, which have decreased their contributions to earnings inequality. The labor market has also become more segmented in terms of work unit sector, which has increased its contribution to earnings inequality, but has also become less segmented in terms of ownership, which has actually started to contribute to earnings equality. These observations show that urban China’s labor market has been becoming more market-oriented and has been progressing overall, except for its increasing gender discrimination and segmentation by sector.

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