|Title||Labor Market Conditions and Social Insurance in China (IFN Working Paper No. 924)|
|Year of Publication||2014|
|Institution||Research Institute of Industrial Economics (IFN)|
|Keywords||China, employer participation, labor market tightness, People’s Republic of China, social insurance|
Fifteen years after the introduction of highly ambitious social insurance programs for urban Chinese workers, a large number of them remain un-insured. This paper examines the relationship between labor market conditions and social insurance participation among industrial firms in the pre-crisis years of 2000-2007. I find that increased labor tightness over this period was a quantitatively important driver of participation. Comparing different segments of the labor market, stronger response to tightness is found in sectors with the largest shares of un-insured: private firms, those with a larger share of low-educated workers, and those without labor unions. Increased tightness in the years ahead can therefore be expected to aid policy makers in social insurance implementation and in combating insurance inequality.