(1.Economics and Management Department ,East China Normal University;
2.School of Applied Technology, Jiaxing University)
Abstract: The‘labor shortage’ , which has been baffling the economic development in the Pearl River Delta, has been interpreted in the frontier literature from the perspectives of labor supply and mobility, wages and social security. This paper, however, attempts to investigate the problem in the Pearl River Delta from the perspective of the deep-seated reasons of labor demand change - the technology bias progress. The CES production function is constructed, while both the capital technological progress bias index and the skill bias index are estimated, which makes it possible to make both the quantitative analysis of enterprise labor demand and the empirical study of the influencing factors. The determination of technological progress biased index shows that techno⁃
logical progress in the Pearl River Delta is in favor of labor, i.e. a large labor demand causes extensive labor shortage and a high employment vacancy rate, revealing a more deeply rooted cause of the‘labor shortage’pervading in the Pearl River Delta. The empirical study indicates that the technology spillover in Hong Kong, Macao and Taiwan is inducible to the development of labor biased technological progress, while the technology spillover as well as independent R & D in other regions play an restraining role, and factor endowment structure is the main cause of labor biased technological progress in the Pearl River Delta. The determination of skill biased technological change index also shows that the technological progress in the Pearl River Delta is in favor of
skilled labor wages, which causes a large opening in skilled labor in the region, thus explaining the dominated structural shortage of skilled labor. The empirical study also indicates that independent R&D promotes the development of skill biased technological progress, while the development of foreign trade suppresses it, and the supply and demand factors play a decisive role in the skill biased technological progress in the Pearl River Delta.
Key Words: Pearl River Delta; Labor Shortage; Biased; Technological Progress; Labor Supply and Demand