High-Skilled Services and Development in China
35 Pages Posted: 6 Dec 2019
Date Written: 2019-11-01
We document that the employment share of high-skill-intensive services is much lower in China than in countries with similar gross domestic product (GDP) per capita. We build a model of structural change with goods and low- and high-skill-intensive services to account for this observation. We find that large distortions limit the size of high-skill-intensive services in China. If they were removed, both high-skill-intensive services and GDP per capita would increase considerably. We document a strong presence of state-owned enterprises in high-skill-intensive services and argue that this presence leads to important distortions.
Keywords: mortgage default, foreclosure, externality, policy, vacancy
JEL Classification: O41, O47, O51
Suggested Citation: Suggested Citation