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Development and Sources of Labor Productivity in Chinese Provinces

Author

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  • Almas Heshmati

    (Department of Economics, Sogang University, Room K526, 35 Baekbeom-ro (Sinsu-dong #1), Mapo-gu, Seoul 121-742, Korea)

  • Biwei Su

    (Department of Food and Resource Economics, Korea University, Seoul, Korea)

Abstract

As China exhibited unprecedented rapid economic growth ever since its reform and opening, the development and sources of labor productivity has gradually come to the forefront. This paper studies the development and the source of labor productivity in 31 Chinese provinces during 2000–2009. The labor productivity is investigated through an examination at both the levels and the growth rate. Particularly, we first look at the production function relationship, to see the contribution of labor and other production factors to the gross domestic product. Then, a number of possible determinants are defined. They are regressed on the level and the growth rate of labor productivity to shed light on their relationships. Controlled for unobserved time-specific and province-specific effects, the fixed effects model with heteroskedasticity robust adjustments have been used for the estimation of three functions. Regional breakdown shows severe disparity in the economy where three municipal cities have the highest labor productivity among other regions. Subsequently, we summarize the different sources and their contributions to labor productivity and provide several policy suggestions.

Suggested Citation

  • Almas Heshmati & Biwei Su, 2013. "Development and Sources of Labor Productivity in Chinese Provinces," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 2(02), pages 1-30.
    • Handle: RePEc:wsi:ceprxx:v:02:y:2013:i:02:n:s1793969013500052
    DOI: 10.1142/S1793969013500052
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    2. Suna Korkmaz & Oya Korkmaz, 2017. "The Relationship between Labor Productivity and Economic Growth in OECD Countries," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(5), pages 71-76, May.
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    5. Dong, Kangyin & Wei, Shuo & Liu, Yang & Zhao, Jun, 2023. "How does energy poverty eradication promote common prosperity in China? The role of labor productivity," Energy Policy, Elsevier, vol. 181(C).

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    More about this item

    Keywords

    Development; labor productivity; labor productivity growth; provinces; China;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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