Hidden Bibliographic Details
| Other authors / contributors: | Dao, Mai, author.
International Monetary Fund. Research Department, issuing body.
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| ISBN: | 1283570106
9781283570107
1455270466
9781455270460
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| Notes: | Includes bibliographical references.
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| Summary: | We examine the impact of real exchange rate fluctuations on sectoral and regional employment in China from 1980 to 2008. In contrast to theoretical predictions, employment in both the tradable and non-tradable sectors contracts following a real appreciation. Our results are robust across different sub-samples, levels of sectoral disaggregation, and are more pronounced for regions with higher export exposure. We attribute our findings to the importance of services as intermediate input in exportable production. We test this channel of exchange rate transmission using regional input-output tables linked with employment data at the region-sector level. The results of this paper have important implications for Chinas labor market adjustment should the Chinese RMB strengthen in the future. To mitigate the costs of short-run labor market adjustment, appropriate demand management and structural reforms in the non-traded sectors should play an important role.
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| Standard no.: | 10.5089/9781455270460.001
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