We thank Theodore Eisenberg, Dawn Chutkow, and one anonymous referee for their insightful comments and suggestions. We appreciate helpful discussions with Jeffrey Rachlinski, Valerie Hans, Yun-Chien Chang, and other participants at the 2012 Journal of Empirical Legal Studies Conference on Asian Empirical Scholarship at the University of Hawaii, Richardson School of Law. Funding from the University of International Business and Economics is gratefully acknowledged.
The Effects of the Labor Contract Law on the Chinese Labor Market
Article first published online: 19 AUG 2013
© 2013, Copyright the Authors. Journal compilation © 2013, Cornell Law School and Wiley Periodicals, Inc
Journal of Empirical Legal Studies
Volume 10, Issue 3, pages 462–483, September 2013
How to Cite
Cui, F., Ge, Y. and Jing, F. (2013), The Effects of the Labor Contract Law on the Chinese Labor Market. Journal of Empirical Legal Studies, 10: 462–483. doi: 10.1111/jels.12016
- Issue published online: 19 AUG 2013
- Article first published online: 19 AUG 2013
- University of International Business and Economics
This article uses a micro-level data set to investigate the effect of China's Labor Contract Law, implemented in 2008, on the Chinese labor market. Our empirical evidence shows that the labor law reform significantly improved employee benefit. This effect is greater for state-owned enterprises, for large and domestic firms, and for regions with high unionization and high skill intensity. The Labor Contract Law significantly reduces the wage elasticity of labor demand, especially in highly unionized and skill-intensive industries. However, this effect is less significant in globalized industries and female-employee-intensive industries. Overall, our results emphasize the important role of China's Labor Contract Law in improving employment protection, and substantial variations in the impact of labor law reform across different firms, regions, and industries.