China’s Uneven Labor Flow and Its Effect on Regional Disparities

PAN Yue1  and DU Xiaomin2

1Associate Professor with Department of Finance, College of Economics of Xiamen University

2Ph.D candidate at College of Economics, Xiamen University
Abstract:

This paper is the first to use a non-parameter additive model in the empirical analysis of the impact of cross-regional labor flow on industrialization and economic growth in China’s eastern, central and western regions. Results indicate that labor flow has significantly different effects on the direction and intensity of impact on economic development across regions: massive labor inflow from the central and western regions to the eastern region significantly promoted the industrialization process and economic growth in the East, while the impact of labor outflow from the central and western regions on the regional economies is in a significantly inverted-U shaped non-linear relationship. Uneven labor flow across regions has widened China’s regional economic disparities.

Key Words:

labor flow, industrialization process, economic growth, additive model

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