The purpose of this paper is to aid theoretical and evidentical analysis of the mechanism of economic growth and labor movement in the economically developed regions in China.
First, we followed the W. A. Lewis model―the dual economic theory: we made a set of models about economic growth and labor mobility for China's economically developed rural regions, and then analyzed the relationships between the variables of the models. Secondly, we gave two conditions for using the Lewis model, and used Wuxi country's data to substantiate them. Lastly, we used the results of Section 1, and tried to find the mechanism of economic growth and labor movement through the Wuxi county's case. The following are the major findings.
1) The over-employment in the agricultural sector and the behavior under the market principles in the non-agricultural sector exist there in the rural economic system (e.g. in Wuxi county).
2) Economic growth in the rural regions, especially the industrial sector's growth, can be explained by the dual economy principle. That is, due to the over-employment in the agricultural sector and the lower wage-rates in the non-agricultural sector, the growth of the industrial sector, and then the economic growth, can be quickly realized.
3)Through the regression evaluation, we found that the lower wage-rates in the non-agricultural sector can be maintained mainly because of the insufficient natural resource within the agricultural sector.
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