On foreign-invested enterprises’ exit: Economic development or labor market price regulation?
We use the prefecture-level panel data and enterprise-level data of China's manufacturing enterprises from 2001 to 2009 to investigate the effects of economic development and minimum wage policy on foreign-invested enterprises' exit behavior. The increase of local minimum wage from the 25t...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
KeAi Communications Co. Ltd.
2022-09-01
|
| Series: | China Economic Quarterly International |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S2666933122000387 |
| _version_ | 1797976400608624640 |
|---|---|
| author | Ruixiang Xiong Qian Wan Wenquan Liang |
| author_facet | Ruixiang Xiong Qian Wan Wenquan Liang |
| author_sort | Ruixiang Xiong |
| collection | DOAJ |
| description | We use the prefecture-level panel data and enterprise-level data of China's manufacturing enterprises from 2001 to 2009 to investigate the effects of economic development and minimum wage policy on foreign-invested enterprises' exit behavior. The increase of local minimum wage from the 25th percentile to the 75th percentile accounts for 20% of the average exit rate of foreign-invested manufacturing enterprises, while the local economic development does not affect the exit of foreign-invested manufacturing enterprises. Compared with “market-oriented” foreign-invested enterprises, “cost-saving-oriented” foreign-invested enterprises are more likely to exit from the market owing to the rise of minimum wage. Enterprises in industries with high labor intensity, large scales, low average wages, relatively high proportions of low-skilled labor, fierce competition, and poor industrial supporting facilities are more likely to be negatively affected by the rise of minimum wages. |
| first_indexed | 2024-04-11T04:50:17Z |
| format | Article |
| id | doaj.art-b5d5982dd1c34e649da9d88f7a47cffc |
| institution | Directory Open Access Journal |
| issn | 2666-9331 |
| language | English |
| last_indexed | 2024-04-11T04:50:17Z |
| publishDate | 2022-09-01 |
| publisher | KeAi Communications Co. Ltd. |
| record_format | Article |
| series | China Economic Quarterly International |
| spelling | doaj.art-b5d5982dd1c34e649da9d88f7a47cffc2022-12-27T04:38:54ZengKeAi Communications Co. Ltd.China Economic Quarterly International2666-93312022-09-0123215226On foreign-invested enterprises’ exit: Economic development or labor market price regulation?Ruixiang Xiong0Qian Wan1Wenquan Liang2Business School of Hunan Normal University, ChinaInstitute for Economic and Social Research, Jinan University, ChinaSchool of Economics, Jinan University, China; Corresponding author.We use the prefecture-level panel data and enterprise-level data of China's manufacturing enterprises from 2001 to 2009 to investigate the effects of economic development and minimum wage policy on foreign-invested enterprises' exit behavior. The increase of local minimum wage from the 25th percentile to the 75th percentile accounts for 20% of the average exit rate of foreign-invested manufacturing enterprises, while the local economic development does not affect the exit of foreign-invested manufacturing enterprises. Compared with “market-oriented” foreign-invested enterprises, “cost-saving-oriented” foreign-invested enterprises are more likely to exit from the market owing to the rise of minimum wage. Enterprises in industries with high labor intensity, large scales, low average wages, relatively high proportions of low-skilled labor, fierce competition, and poor industrial supporting facilities are more likely to be negatively affected by the rise of minimum wages.http://www.sciencedirect.com/science/article/pii/S2666933122000387Minimum wageForeign-invested enterprisesExit |
| spellingShingle | Ruixiang Xiong Qian Wan Wenquan Liang On foreign-invested enterprises’ exit: Economic development or labor market price regulation? China Economic Quarterly International Minimum wage Foreign-invested enterprises Exit |
| title | On foreign-invested enterprises’ exit: Economic development or labor market price regulation? |
| title_full | On foreign-invested enterprises’ exit: Economic development or labor market price regulation? |
| title_fullStr | On foreign-invested enterprises’ exit: Economic development or labor market price regulation? |
| title_full_unstemmed | On foreign-invested enterprises’ exit: Economic development or labor market price regulation? |
| title_short | On foreign-invested enterprises’ exit: Economic development or labor market price regulation? |
| title_sort | on foreign invested enterprises exit economic development or labor market price regulation |
| topic | Minimum wage Foreign-invested enterprises Exit |
| url | http://www.sciencedirect.com/science/article/pii/S2666933122000387 |
| work_keys_str_mv | AT ruixiangxiong onforeigninvestedenterprisesexiteconomicdevelopmentorlabormarketpriceregulation AT qianwan onforeigninvestedenterprisesexiteconomicdevelopmentorlabormarketpriceregulation AT wenquanliang onforeigninvestedenterprisesexiteconomicdevelopmentorlabormarketpriceregulation |