Page 46 - Special Topic Session (STS) - Volume 2

STS452 Nobuhiro O.
increase in the number of the population play a crucial factor in the growth of
industrial production.
Third, we find the employment induced by final demand in the lower-left
of the table. This model considers only employment in urban areas assumed
to be induced by the final demand of sectors. The number of employment in
urban areas is increased, 3.18 people in primary, 6.87 people for secondary,
and 8.94 people for the tertiary sector respectively. And also, the same number
of people are decreased in rural areas. Thus, approximately 19 people are
migrated from villages to cities by a unit increase in final demand.
Finally, the lower-right of the table illustrates the information about the
demographic change, in particular, the process of urbanisation in China. That
is defined here as ‘urban and rural labour allocation multiplier’, simply,
‘urbanization multiplier.’ Urban employment multiplier is 1.280 whereas the
same amount of negative figure is the rural employment multiplier. From the
viewpoint of rural households, their probability of taking a job in urban areas
is 0.119 (11.9%), and the probability of remaining in rural areas is 0.881
(88.1%).
In order to understand how the model works deeply, the changes in each
element of the multiplier are investigated by the changes of labour accounts
from 2008 to 2017 with remaining constant of input-output data for 2015.
That is, we can see the changes in impacts on the whole economy and
demography induced by the changes in labour allocation between urban and
rural areas, assuming that the economic structure is unchanged.
The results are shown in Figure 3 and 4. As seen in Figure 1 and 2, there
was a tendency of labour migration from rural areas to urban areas with a
slight increase in total labour supply in China from 2008 to 2017. Figure 3
indicates that with the constant of input-output structure, the Leontief
multiplier or total sum of it called backward linkages is marginally decreasing
even though the secondary sector has the strongest backward linkage among
sectors. The movement of labour from the urban sector to rural sector might
have a force to reduce the backward linkages in the whole country.
Reflecting this change in backward linkages, the output induced by total
household consumption is also decreasing, in particular, urban household, but
the consumption of rural areas remain relatively stable (The right of Figure 3).
We still need further analysis of the reason why they are decreasing as the
urban population increases. The result seems to be opposite to our intuition.

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