| Summary/Abstract |
Structural change theories usually assume agents are homogeneous. However, because of demand-side or supply-side heterogeneities, the probability of switching among sectors differs across people. This paper reveals these differences through restoring a long-period, individual-level panel dataset from China's Urban Household Survey for 1986–2009. We find that both for people who started working for the first time and those who switched jobs, the sector choice depends on personal characteristics. In particular, women and people with higher educational attainment or a previous white-collar job are more likely to join the tertiary sector and less likely to join the primary sector. These effects are substantial even if the macroeconomic variables used in conventional structural change theories are controlled. They are also robust in various periods and at more detailed industry levels. Our research suggests that it is important to pay greater attention to the labor composition when making policy related to economic structural change.
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