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Rural-urban disparity and sectoral labour allocation in China
This study examines China's rural-urban segmentation and its causes in the context of economic reforms. Household survey and aggregate data indicate a V-shaped process in which rural-urban consumption and income differentials decreased between 1978 and 1985, but then have continually increased...
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Published in: | The Journal of development studies 1999-02, Vol.35 (3), p.105-133 |
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container_title | The Journal of development studies |
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creator | Tao Yang, Dennis Zhou, Hao |
description | This study examines China's rural-urban segmentation and its causes in the context of economic reforms. Household survey and aggregate data indicate a V-shaped process in which rural-urban consumption and income differentials decreased between 1978 and 1985, but then have continually increased to historically high levels. This sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban/state-owned industries than in rural industries and agriculture. To explain the V-shaped change, we argue that the precedent of successful rural reforms raised farmers' relative earnings, but the remaining obstacles to an efficient sectoral allocation of labour have prevented China from eliminating dualism. Recent financial policies consisting of urban price subsidies and increased investment credits have also had influential distribution effects that are biased against the rural sector. |
doi_str_mv | 10.1080/00220389908422575 |
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Household survey and aggregate data indicate a V-shaped process in which rural-urban consumption and income differentials decreased between 1978 and 1985, but then have continually increased to historically high levels. This sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban/state-owned industries than in rural industries and agriculture. To explain the V-shaped change, we argue that the precedent of successful rural reforms raised farmers' relative earnings, but the remaining obstacles to an efficient sectoral allocation of labour have prevented China from eliminating dualism. 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Household survey and aggregate data indicate a V-shaped process in which rural-urban consumption and income differentials decreased between 1978 and 1985, but then have continually increased to historically high levels. This sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban/state-owned industries than in rural industries and agriculture. To explain the V-shaped change, we argue that the precedent of successful rural reforms raised farmers' relative earnings, but the remaining obstacles to an efficient sectoral allocation of labour have prevented China from eliminating dualism. Recent financial policies consisting of urban price subsidies and increased investment credits have also had influential distribution effects that are biased against the rural sector.</abstract><cop>London</cop><pub>Taylor & Francis Group</pub><doi>10.1080/00220389908422575</doi><tpages>29</tpages></addata></record> |
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subjects | Agriculture Allocation China China, People's Republic of Consumption Development strategies Economic reform Expenditures Factors Financial policy Households Income Inequality Labor Labor economics Labor market Labor Productivity Labour force Labour productivity Peoples Republic of China Per capita Policy Reform Prices Production functions Productivity Public policy Ratios Rural areas Rural Government Rural Urban Differences Social Segmentation Stagnation Subsidies Trends Urban Affairs Urban areas |
title | Rural-urban disparity and sectoral labour allocation in China |
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