Dual Binary Labor Market Segmentation and the Wage Differentials in China

The purpose of this article is to investigate the pattern of labor market segmentation and wage determination in China. Using the data from CHNS, we performed the analysis of variance to judge the significance of different variables which might lead to the wage differentials and found a multi-variation regression measurement model of labor market based on the Mincer model. The empirical results show that the pattern of labor market segmentation in China is dual binary labor market segmentation. In this labor market, though more educated workers have more advantage in wage distribution, significant wage differentials persist after controlling for individual attributes. Empirical analysis also provides evidence that the gender of the worker plays an important role in the wage determination mechanism in all the segmented labor markets.