Labor Demand in China: Comparison between Fast Growing Regions and Others

    By using the data from various sources, the paper depicts the labour market developments in different regions of China and identifies fast growing regions (FGRs). It estimates region-wise labour demand elasticities both for short and long run. It finds that the Chinese economy has not transformed its growth pattern from an input-based one to a productivity-based one. Lastly, the paper argues that as the advantage of China in labour supply disappears, diminishing returns to capital will sooner or later occur if the sustainability of economic growth is not based on higher productivity. Sustaining rapid economic growth would require a fundamental transformation of the growth pattern in China.
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    ( in The Indian Journal of Labour Economics, Vol.50, No.3, July-Sep,2007 )