The Impact Of Wage Gap By China’s Partticipation In Global Value Chains

With the continuous progress of science and technology,the international division of labor continues to develop and deepen,and the division of product production begins to be further refined to various processes,forming a global value chain.Since the reform and opening up,China has been actively embedded in the global value chain and has become the factory of the world.But at the same time,China’s income gap began to increase,income distribution has gradually become the focus of social concern.This paper studies the influence of global value chain(GVC)on wage gap.While global value chain brings huge benefits to China’s economic development,whether it also has an impact on China’s wage gap,and what impact it has,has become a problem to be studied in this paper.Firstly,on the basis of sorting out relevant literature,the transmission mechanism of global value chain on wage gap is theoretically analyzed.This paper mainly analyzes the transmission mechanism of GVC on wage gap from four aspects of international factor flow,employment market,technological progress and industrial value added,and studies the different effects of GVC on wage gap of different skilled workers and puts forward theoretical hypotheses.Secondly,the development level of China’s global value chain and the status of the wage gap between workers are calculated and analyzed.The data of world inputoutput database(WIOD2016)were mainly used.First,China’s participation in the lower reaches of the global value chain is measured and compared.The results show that the global value chain downstream degree of China’s overall industry is low.Second,according to the level of education,the labor force is divided into high,medium and low skill levels,and the wage gap between them is calculated.It is found that the wage gap between skilled labor(high and medium skilled laborers)and unskilled labor(medium and low skilled laborers)is the largest,followed by the wage gap between unskilled laborers,and the wage gap between skilled labor is the smallest.Thirdly,empirical analysis is made on the effect of global value chain on wage gap.The wage gap between value chain and skilled labor,wage gap between unskilled labor,wage gap between skilled labor and unskilled labor is analyzed by econometric model.The study found that,on the whole,the decline of global value chain downstream has a positive impact on China’s wage gap;The effect of wage gap between different skilled labor forces in China is different,among which,the effect on the expansion of wage gap between skilled labor and unskilled labor is the highest,and the effect on the income gap between skilled labor forces is greater than the effect on the income gap between unskilled labor forces.Finally,the research conclusion is summarized and the corresponding policy Suggestions are put forward.First,to enhance China’s manufacturing industry’s participation in the global value chain;Second,enhance China’s service sector participation in the global value chain downstream degree;Third,narrow the income gap caused by technological differences;Fourth,solve the employment problem of unskilled labor force;Fifth,the government should increase the supply of public goods and security transfer payments;Sixth,we will improve the individual income tax system.