TITLE:
Services Trade and Labor-Demand Elasticities of Service Sector: Empirical Evidence from China
AUTHORS:
Hao Wei, Qiang Fu, Sui Yang
KEYWORDS:
Trade Liberalization; Labor-Demand Elasticities; Service Sector; Substitution Effect; Output Effect
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.2 No.4,
October
31,
2012
ABSTRACT: This paper analyses the impact of services trade on the labor-demand elasticities of service sector with the data of China from 1982 to 2009.we find that: 1) First, no matter in the long run or in the short term, China’s services export distinctly impacts on the labor-demand elasticities of service sector. In the long-term influence, the substitution effect is much more powerful than the output effect, however, as to the short period, the output effect is a little stronger than the substitution effect; 2) Second, in the long run, we cannot reject the hypothesis of no relationship between service import openness and the labor-demand elasticities of service sector. Whereas, studying the result of the short term, trade liberalization of services import does affect the service sector labor-demand elasticity weakly.