services trade and labor-demand elasticities of service sector empirical evidence from china服务贸易和劳动需求弹性的服务行业经验证据来自中国.pdf

American Journal of Industrial and Business Management, 2012, 2, 136-144 /10.4236/ajibm.2012.24018 Published Online October 2012 (http://www.SciRP.org/journal/ajibm) Services Trade and Labor-Demand Elasticities of Service Sector: Empirical Evidence from China Hao Wei, Qiang Fu, Sui Yang School of Economics and Business Administration, Beijing Normal University, Beijing, China. Email: weihao1006@ Received May 26th, 2012; revised June 25th, 2012; accepted July 23rd, 2012 ABSTRACT This paper analyses the impact of services trade on the labor-demand elasticities of service sector with the data of China from 1982 to 2009. We find that: 1) First, no matter in the long run or in the short term, China’s services export dis- tinctly impacts on the labor-demand elasticities of service sector. In the long-term influence, the substitution effect is much more powerful than the output effect, however, as to the short period, the output effect is a little stronger than the substitution effect; 2) Second, in the long run, we cannot reject the hypothesis of no relationship between service import openness and the labor-demand elasticities of service sector. Whereas, studying the result of the short term, trade liber- alization of services import does affect the service sector labor-demand elasticity weakly. Keywords: Trade Liberalization; Labor-Demand Elasticities; Service Sector; Substitution Effect; Output Effect 1. Introduction effect and the output effect. In the empirical analysis part, three tests—the tests of stationarity, cointegration analy- From the Reform and Open, China’s service sector has sis and the error correction model tests are carried out. been developing quickly and the growth of services trade