Analyzing the effects of labor unions on provincial economic performance in China

What is it about?

This article analyzes data from 29 Chinese provinces between 1994 and 2008 to explore the relationship between the level of unionization in a province and important economic outcomes (average wage levels, employment, productivity, and economic output). We find the following results: a) Chinese unions do not appear to be associated with higher wages, b) unions do appear to be associated with higher GDP and productivity, and c) the relationship between unions and provincial employment is complex and needs further study.

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Why is it important?

Given the limited empirical analyses of Chinese unions and the lack of consistency among the few studies that have been undertaken, these results using provincial-level data are important for adding to understanding of Chinese employment relations. But future research efforts should use microdata and case studies to better uncover the specific mechanisms that underlie the relationship between unions and wages, employment, and productivity in China.