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INDUSTRIAL AGGLOMERATION AND EMPLOYER COMPLIANCE WITH SOCIAL SECURITY CONTRIBUTION: EVIDENCE FROM CHINA

Authors


  • We would like to thank the editor, two anonymous referees, Anping Chen, Shihe Fu, Zhigang Li, Yi Lu, Démurger Sylvie, and Wei Xiao for very useful comments and suggestions. Financial supports from the National Natural Science Foundation of China (71302101, 71273285), Guangdong Natural Science Foundation (S2012040007983), and Guangdong Provincial Science and Technology Project (2011B061200008) are acknowledged. All remaining errors are our own.

ABSTRACT

This paper, by using annual surveys of Chinese manufacturing firms from 2001 to 2007, investigates the relationship between industrial agglomeration and employer compliance with required pension contributions. The result of panel fixed-effect estimation shows that in the more agglomerated industrial areas, firms comply with pension mandates at a higher level. Our finding is robust to various specifications and estimations employing instrumental variables.

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