State-Owned Enterprise, Labor Redundancy, and Job Creation: The Experience of Chinese Provinces from 1986 to 1996

23 Pages Posted: 11 Nov 2003

See all articles by Guo Li

Guo Li

World Bank - Rural Development (EASRD)

Lixin Colin Xu

World Bank - Development Research Group (DECRG); World Bank - Development Research Group (DECRG)

Date Written: 2002

Abstract

Little is known about the magnitude of China's SOE labor redundancy and the patterns and determinants of job creation. Such knowledge gap makes it difficult for decision-makers to provide prescriptions for China's labor problems. This paper uses a panel data of Chinese provinces between 1986 to 1996 to estimate China's SOE labor redundancy, and patterns and determinants of job creation in China. We find that (i) releasing all redundant workers would raise the average urban unemployment rate to 25 percent; (ii) SOE labor redundancy proved to be a major impediment of job creation; (iii) patterns of job creation performance were mainly explained by structural variables such as SOE labor redundancy, schooling, railway mileage, and distance to seaport; and (iv) demand variables such as GDP growth rates, trade exposure and FDI inflow, in contrast, did not explain much.

Keywords: China, Asia, state-owned enterprises, labor redundancy, unemployment, job creation

JEL Classification: J4, J6, P5

Suggested Citation

Li, Guo and Xu, Lixin Colin and Xu, Lixin Colin, State-Owned Enterprise, Labor Redundancy, and Job Creation: The Experience of Chinese Provinces from 1986 to 1996 (2002). Available at SSRN: https://ssrn.com/abstract=432060

Guo Li

World Bank - Rural Development (EASRD) ( email )

Washington, DC 20433
United States

Lixin Colin Xu (Contact Author)

World Bank - Development Research Group (DECRG) ( email )

1818 H Street NW
MSN3-311
Washington, DC 20433
United States

World Bank - Development Research Group (DECRG) ( email )

1818 H Street NW
MSN3-311
Washington, DC 20433
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
244
Abstract Views
2,123
rank
178,039
PlumX Metrics