Abstract
Based on the exogenous event of China's accession to the World Trade Organization, using the data of tariff and employment in 2000 and 2010, this paper divides employment into formal and informal employment and studies the impact of lower tariff of final and intermediate goods on the employment change of China's labor market at the city level. It can be seen from the empirical results that the more the tariff of the main industries in a region falls, the greater the growth of total employment and informal employment in the region. The temporary nature of informal employment makes it more responsive to shocks of liberalization at first, while the formal may lag. The eastern coastal areas of China have more developed economy and its industrial emphasis facing larger tariff cuts, while the western areas are relatively less developed and its industrial emphasis facing smaller tariff cuts. Correspondingly, the employment situation in the eastern areas is relatively prosperous, absorbing a large number of informal employments.
Highlights
Since the reform and opening up, the gradual evolution of China's foreign policy and foreign trade has had a profound impact on the regional coordinated development of China's economy
The regression results show that the coefficient sign of total employment and informal employment is positive, which is significant at the level of 1%
The level of trade liberalization in cities is positively related to the scale of total employment and informal employment
Summary
Since the reform and opening up, the gradual evolution of China's foreign policy and foreign trade has had a profound impact on the regional coordinated development of China's economy. China's reform and opening-up policy has been implemented in different regions at different times, provinces and cities in China have complex terrain, diverse climate, different geographical advantages and economic and social development levels. Which results in different industrial structures and development levels of different provinces and cities. These inborn differences, coupled with the imbalance of the postnatal economic and trade policies, make the costs and gains of China's provinces and cities in the process of trade liberalization vastly different (Zhang et al, 2014; Zhang, 2015). As the largest exporter and the second-largest importer, the final goods tariff and intermediate input tariff have different impacts on the Chinese regional economy and labor market
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