Long Term Contribution Of Qualifications To Labor Income Inequality

Reform and opening up and market economy have brought great wealth to China,but followed by the aggravation of residents’ income inequality.The income inequality of residents comes from two aspects-the inequality of labor income and the inequality of capital income.Different from the capital income gap,the labor income gap affects more the general public in the economy and society,and determines the scale of low-income groups and middle-income groups.Different from the capital income gap,the labor income gap affects more the general public in the economy and society,and determines the scale of low-income groups and middleincome groups.How to change,why to change and how to narrow the labor income gap has become an urgent problem to be solved.At the same time,great changes have taken place in the education system and labor market mechanism.The continuous reform of the education system leads to the continuous change of the structure and value of qualifications at the supply side of the labor market,and then reflects the differences brought by this reform in the labor income inequality of workers.As a reward for workers through education investment,qualifications measure the human capital output by workers through education investment on the one hand,and the innate ability signal filtered by workers through the education system on the other hand.In the long-term development of China,the number of highly educated workers has gradually increased,and the structure of qualifications has changed;The market-oriented reform has also made great changes in the value of qualifications in the market.The long-term changes in the structure and value of qualifications determine the contribution of qualifications in the change of labor income gap.Using the data of five periods of China Household Income Survey(chip)from 1988 to 2013,and using the RIF regression decomposition method,this paper finds that:(1)the contribution of medium and long-term qualifications to the labor income gap increases first and then decreases.(2)Qualifications affects the labor income gap through qualifications structure and qualifications value,showing a trend of rising first and then narrowing,and in the long run,the income gap brought by qualifications structure gradually catches up with qualifications value;(3)The long-term contribution of qualifications background to the labor income gap of heterogeneous labor groups is obviously different;(4)The relative trend of long-term change of labor income gap in different qualifications groups is different.The overall labor income gap of workers with low qualifications is larger than that of workers with medium and high qualifications in most periods.Based on the research results,this paper puts forward feasible policy suggestions:(1)improve the output structure of higher qualifications,improve the efficiency of qualifications supply,and give better play to the mechanism of narrowing the labor income gap through qualifications distribution by adjusting the qualifications structure in the labor market;(2)We should innovate the education system to adapt to the labor market,establish a rights and interests protection system to eliminate market discrimination,and give better play to the mechanism of narrowing the labor income gap through the value of academic qualifications.(3)Rationally allocate resources,narrow the educational inequality between urban and rural areas,improve the dilemma of "scholars" who are difficult to get out of poor schools,narrow the gap between the structure and value of qualifications in rural areas and urban areas,and improve the labor income gap between urban and rural areas.