Rising Labor Cost,Processing Trade Transfer and Climbing Enterprise Value Added Rate of Export ProductsChinese Full Text

Tie Ying;Huang Jianzhong;Gao Xiang;

Abstract: As China’s export domestic value-added rate（ DVAR） continues to rise,accompanied by an obvious increase in labor cost and a significant decline in the proportion of processing trade,the source of DVAR elevation in China comes either from what the research results show the substitution of foreign for domestic intermediate products brought about by investment liberalization,i. e. "active"promotion? or simply from the rising cost resulting in a continuous withdrawal of processing trade from the market,i. e. "passive"promotion? Based on the 2000—2006 micro data,this paper estimates the DVAR at the level of enterprises,depicts the dynamic evolution process of enterprise DVAR from the perspective of the withdrawal of processing trade,and examines the relationship among the labor cost（ minimum wage as its proxy）,the processing trade and the enterprise export DVAR. An empirical study shows that:（1） the rising labor cost will cause the climbing DVAR of Chinese enterprises,which is highly robust in the robustness tests of multiple dimensions.（2） The promoting impact of the minimum wage increase on Chinese enterprise DVAR is realized by squeezing the processing trade out of the market.（3） The more the minimum wages rise,the stronger the positive impacts areon the DVAR of high-productivity enterprises,foreign-invested and capital-intensive firms. It is found that the rise of China’s DVAR is at least part of the resulting processing trade transfer,and the import promotion and upgradation of the quality of domestic intermediate goods will be an important policy orientation at the current phase of development.

Keywords：

Labor Cost; Minimum Wage; Processing Trade; DVAR;

DOI：
10.19343/j.cnki.11-1302/c.2018.06.005
Series：
(H) Education ＆ Social Sciences; (J) Economics ＆ Management
Subject：
Science of Talent and Labor Science; Macro-economic Management and Sustainable Development; Trade Economy
Classification Code：
F249.21;F752.62

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Rising Labor Cost,Processing Trade Transfer and Climbing Enterprise Value Added Rate of Export ProductsChinese Full Text

Tie Ying;Huang Jianzhong;Gao Xiang;

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