Trade, technology, and China's rising skill demand

Bin Xu (First Author), Wei Li (Participant Author)

Research output: Contribution to journalJournal


China has experienced rising wage inequality due to rising relative demand for skilled labour. In this paper, we use a sample of 1,500 firms to investigate the impact of trade and technology on China's rising skill demand. We find that export expansion had a negative direct effect (Heckscher–Ohlin type) and a positive indirect effect (export-induced skill-biased technical change) on skill demand; the net effect was found positive and accounted for 5 percent of rising skill demand of the sample firms. We find that technical change in Chinese firms was on average skill-neutral, but majority foreign-owned firms experienced skill-biased technical progress that accounted for 22 percent of the rising skill demand of the sample firms.
Original languageEnglish
Pages (from-to)59-84
JournalEconomics of Transition
Issue number1
Publication statusPublished - 2008

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  • ABDC-A
  • Scopus
  • SSCI


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