Wage Differentials And Employment Type Choice In Urban China

Due to the stability and less competiveness in state-owned units,the state-owned units usually associate with labor redundancy and inefficiency.So the labor immobility between different sectors is attracting more and more attention in China.We want to empirically study why employees like to work in public sector.The first issue we focus on in this paper is the wage differentials in different sectors.The second issue we focus on is the factors that influence employees' choice between different sectors.The wage differentials between public and private sector and the individual's sector choice have long attracted economists' attentions,though the literature on wage differentials are much richer than the topic of sector choice.Using CHIP 2013 data,we empirically analyze the wage differentials between sectors and the sector choice in urban China.In this paper we have empirically examined wage equations in GOV sector(including government,party agencies,and public institution),SOE sector(including solely state owned enterprises,state holding enterprises,and collective enterprises),FOE sector(including sino-foreign joint venture and solely owned enterprises),and DOE sector(including individual enterprises and private enterprises)and analyzed factors that influence the sector choice in contemporary urban China.The followings are our main findings in this paper.On average the log wage of male employees is 20.67 percent higher than female employees.The gender wage gap is highest in DOE sector.The return to education is highest in FOE sector for both high school and college education.As regard to the sector choice,the wage rate is an important factor.The increase of wage rate in one sector will increase employee's willingness working in this sector.