An empirical analysis of China's dualistic economic development: 1965-2009

Ercolani, Marco G. and Wei, Zheng (2011) An empirical analysis of China's dualistic economic development: 1965-2009. Asian Economic Papers, 10 (3). pp. 1-29. ISSN 1535-3516

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Abstract

We analyze China's rapid economic development in the context of the dualistic development theory. Over the period 1965–2009, we find that China's economic growth is mainly attributable to the development of the non-agricultural (industrial and service) sector, driven by rapid labor migration and capital accumulation. We find that the sectoral reallocation of labor plays a significant role in promoting China's economic growth. Further, we find that the marginal productivity of agricultural labor stopped stagnating in 1978, which indicates that China entered quickly into phase two of economic development with the initiation of market reforms. Moreover, by 2009, the marginal productivity of labor has likely exceeded the institutional wage, as defined by the initially low average labor productivity, indicating that China may be now in the process of entering phase three of economic development.

Item Type: Article
Additional Information: Copyright MIT Press.
Schools/Departments: University of Nottingham Ningbo China > Faculty of Business > Nottingham University Business School China
Identification Number: 10.1162/ASEP_a_00108
Depositing User: LIN, Zhiren
Date Deposited: 27 Oct 2017 08:01
Last Modified: 19 Nov 2017 17:43
URI: http://eprints.nottingham.ac.uk/id/eprint/47381

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