A Dynamic Analysis of Overstaff in China's State-Owned Enterprises

Posted: 10 Feb 2003

See all articles by Xiangkang Yin

Xiangkang Yin

Deakin University; Financial Research Network (FIRN)

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Abstract

Overstaff in state-owned enterprises (SOEs) is a key and difficult issue in the Chinese economic reform. This paper models the transition process in the reform that SOE overstaff is gradually absorbed by private enterprises and the economy grows through converting redundant SOE workers into active labor force. It characterizes the steady equilibrium, where all overstaff has been completely absorbed, and the dynamic path from current state to the steady equilibrium. The optimal government strategy maximizing household utility in the transition is also discussed.

Keywords: Chinese Economy, Overstaff, State-Owned Enterprise, Dynamics

JEL Classification: E24, P31

Suggested Citation

Yin, Xiangkang, A Dynamic Analysis of Overstaff in China's State-Owned Enterprises. Journal of Development Economics, Vol. 66, No. 1, pp. 87-99, 2001. Available at SSRN: https://ssrn.com/abstract=301467

Xiangkang Yin (Contact Author)

Deakin University ( email )

Melbourne, Victoria
Australia

Financial Research Network (FIRN)

C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia

HOME PAGE: http://www.firn.org.au

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