The Spatial Distribution and Influencing Factors of Employment Multipliers in China’s Expanding Cities

Abstract

In the process of urbanization in developing countries, creating enough jobs to realize the transition from an agricultural population to a non-agricultural population is a major goal of development. The differences and localities of cities need to be considered in the policymaking process. This study estimated the local employment multipliers of expanding cities in China and calculated the employment multiplier of each city. First, there are obvious differences in the size of employment multipliers across cities; therefore, it is necessary to adopt different policies in employment promotion. Second, an inverted-U-shape relationship is detected between employment multiplier and city size, namely the larger the city, the greater the employment multiplier, but when the city size exceeds a certain value, the employment multiplier begins to decline. Third, different degrees of influence are generated by factors for cities at different levels of economic development. Based on the research results, we suggest that expansion of the trade sector be promoted in small- and medium-sized cities, to give full play to its employment multiplier effect; meanwhile, in large cities, the degree of specialization of the trade sector and diversification of the non-trade sector should be improved.