Migrants, Labor Protection And Average Wages

In domestic, double-cut of working age population and migrants, frequent labor disputes, increasing wages force government, enterprises and migrants to revisit the wage effects of migrants and labor protection. With the disappearance of the demographic dividend, low-cost advantage of labor-intensive industries no longer exist, which forces transformation and upgrading of industrial structure and changes economic growth to the mode of intensive, innovative, In this case, the improvement of labor productivity support labor wages. However, the reversal of the relationship between labor supply and demand have triggered extensive reflection of “Lewis turning point” and how to extend the second demographic dividend, in this situation, rising wages caused by supply shortage will not only increase production costs but also lead to potential economic growth rate declining, which is not conducive to sustainable economic development. Thus, there is a dispute about the sources of labor wage increasing. In the process of economic development, household registration system has become the shackles of free movement for migrants which reduces the flexibility of market in allocating labor resources; at the same time, urban-biased policy not only affects the role of migrants as labor supply “reservoir” but also deprived the rights of migrants to share economic outcomes; uneven regional development further weaken the economic and social status of migrants. Based on these background, this paper try to discuss the enterprise factor resulting in market separation equilibrium under labor contract constraints in a micro perspective, and combined with domestic macroeconomic factors to explore systematically the mechanism of wages in a macro perspective.Firstly, sorting out domestic and foreigner research perspective, methods and conclusions related to the topic, and using regional data qualitatively to portray the objective reality: migrants with lower level of labor protection, industrial discriminatory, limited interest demands channels; larger wage gap between inflow and outflow regions, showing a “bipolar” trend; the increasing spatial dependence of labor dispute cases in the inflow and outflow regions, but no significant radiation effects. In this context, constructing a signaling game mode including migrants‘ default cost, sunk cost and social additional cost under the labor contract constrains to investigate the market pooling equilibrium and market separate equilibrium according to enterprise and migrants‘ expected return. From the perspective of enterprise, curb the default cost into the pre-collection costs and later punishment costs, the factors which effect on market separating equilibrium are including collection cost, punishment probability and punishment magnitude, the proportion of various labor types, then numerical simulation results showed that the long-term optimal strategy of market is separating equilibrium.Then, through reconstruct of sub-sector, sub-regional average wage, further broken down into wage-related industrial structure index and relative labor supply index, results showed that theoretically wage increasing from the upgrading of industrial structure and labor supply declining, the conclusion is that, there are 28 regional industrial structure have remarkable ungraded; the areas below the national level of labor supply concentrated in exuberant and insufficient demand areas; in fact, the power of rising wages come from labor supply shortage. In view of this, regarded industrial structure and labor supply as the direct factor, the labor protection and economic grow as the indirect factor, both of which have impact on the migrants wage effects; simultaneously, including the interaction between industrial structure and economic, also the feedback mechanisms between migrants and labor protection, the spatial dependence of migrants and labor protection into the simultaneous equations model.Based on provincial panel data during the period of 2003-2013, Using respectively OLS regression method, 3SlS regression method with the interaction term or not, one-step difference GMM estimation with thelagged dependent variable term to analysis the serial correlation; totally, the conclusions are credible. Empirically showed: increasing migrant inflow to local region will cause local regional employment flows to low value-added industries, at the same time, will cause local regional labor supply declining, which will offset the negative pressure by migrants inflowing in a certain extent; migrants inflow to neighboring region will cause the share of local employment in low value-added industries increasing as well as will cause local labor supply increasing, thus have worsen local wage effects. In addition, migrants inflowing to local regions will strengthen local government protection but migrants inflow to neighboring region will weaken local government protection; however, strengthen government protection have a negative impact on local wage effects but have a positive impact on neighbored wage effects, which means there exist significant feedback mechanisms between migrants and government protection and the spatial dependence is obvious; low value-added industries can significantly kidnap local economic growth, and can‘t disappear with the economy development but improve.Finally, according to the above findings, policy recommendations in the view of rational placement about migrants, accelerating industrial restricting and upgrading, strengthening government protection abide by the labor contract law, breaking administrative barriers and seeking common development, and noted that the paper need to be improved as well as follow-up research directions.