The Effects of Labor Market Reforms and Labor Force Characteristics on Chinese Wages

Chinahas been consideredthe leading manufacturing country of the world for several decades and this can be primarily associated with its extremely cheap sources of labor. Recentstudies however, have started to notice a steady trend in the overall wage rates that the work force is being paid. The focus of this research is to understand how and why the Chinese wage rates have increased in such a rapid manner between the years 1997 and 2011. I find evidence to support that the higher the degree of privatization and educational attainment of employees increases average Chines wage rates,where asan increase in migrant worker supply decreases them. The remainder of this paper is organized as follows. Chapter 1 introduces the subject matter and relevance of the research. Chapter 2 presents the theoretical framework. Chapter 3 provides the review of related empirical literature. Chapter 4 discusses the data and empirical methods employed. Chapter 5 presents the results. Chapter 6 will conclude