Description

For the last decade, a large contingent of manufacturing firms in developmental zones on China’s coast has moved to inland provinces. What are the implications of this move inland for Chinese workers? Research on labor conditions in the current period of economic globalization and mobile capital debates the existence of a “race to the bottom” in labor standards through the pressures of international capital mobility. These theories predict that as inland China develops and attracts a larger amount of foreign and domestic capital, inland governments will compete by offering cheap labor and lower or unenforced standards.

Our argument in this paper is contrarian in that we propose the possibility of a positive relationship between the movement inland and labor conditions. We argue that the movement of manufacturing to inland China is not primarily about cheaper workers, but instead signals the beginning of a fundamental shift in the development model through the employment of a localized workforce.

Using audit data from Apple Corporation suppliers (2007-2013), supplementary survey data, and in-depth interviews, we conduct a structured case study of two cities that have attracted significant investment from Apple suppliers—Chengdu and Shenzhen—to draw some of the main hypotheses and to discuss possible causal mechanisms for this relationship between localized production and better labor conditions. We also provide initial empirical evidence that firm relocation toward inland does not necessarily lead to degradation of labor conditions.

Mary Gallagher is a professor of political science at the University of Michigan where she is also the director of the Kenneth G. Lieberthal and Richard H. Rogel Center for Chinese Studies. Professor Gallagher received her Ph.D in politics in 2001 from Princeton University and her B.A. from Smith College in 1991. She was a foreign student in China in 1989 at Nanjing University. She also taught at the Foreign Affairs College in Beijing from 1996-1997. She was a Fulbright Research Scholar from 2003 to 2004 at East China University of Politics and Law in Shanghai, China. In 2012-2013, she was a visiting professor at the Koguan School of Law at Shanghai Jiaotong University.

Her forthcoming book, Authoritarian Legality: Law, Workers, and the State in China, will be published by Cambridge University Press this year. She is also the author or editor of several other books, including Contagious Capitalism: Globalization and the Politics of Labor in China (Princeton 2005), Chinese Justice: Civil Dispute Resolution in Contemporary China (Cambridge 2011), From Iron Rice Bowl to Informalization: Markets, Workers, and the State in a Changing China (Cornell 2011), and Contemporary Chinese Politics: New Sources, Methods, and Field Strategies (Cambridge 2010).