Globalization and Urban-Rural Migration in Taiwan

In this study, we examine the association of urban-to-rural migration with the deterioration of labor market in urban sector due to the globalization of markets and production. Two measures of the relative impacts of globalization on urban and rural labor markets: changes in rural-urban real earning differential and changes in the rural-urban probabilities of being employed. We, thus, address the following questions. What would be the changes in both rural-urban real earning differential and the rural-urban differential in the probabilities of being employed over the last decade? Can real earning differentials or employment differentials, or both significantly influence the urban-to-rural migration decisions? Which one plays a pivotal role in the analysis? What would be the roles of individual or family characteristics in determining the urban-to-rural migration decisions? The preliminary results show the following implications. First of all, the increasing the probabilities of getting a job in rural sector versus keeping a job in urban sector play a pivotal role in determining the urban-to-rural migration. As employment opportunities became persistently worsen in urban sector, job security in rural became attractive and play a more important role than real earning differential. Secondly, having a family member working in rural sector significantly influences the urban-to-rural migration.