Self-Employment of Rural-to-Urban Migrants in China
AbstractThis paper focuses on the determinants of self-employment among rural to urban migrants in China. Two self-selection mechanisms are analysed: the first relates to the manner in which migrants choose self-employment or paid work based on the potential gains from either type of employment; the second takes into account that the determinants of the migration decision can be correlated with employment choices. Using data from the 2008 Rural-Urban Migration in China and Indonesia (RUMiCI) survey, a selection model with endogenous switching is estimated. Earnings estimates are then used to derive the wage differential, which in turn is used to model the employment choice. The procedure is extended to account for migration selectivity and to compare individuals with different migration background and employment histories. The results indicate that self-employed individuals are positively selected with respect to their unobserved characteristics. Furthermore, the wage differential is found to be an important driver of the self-employment choice.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5805.
Length: 23 pages
Date of creation: Jun 2011
Date of revision:
Publication status: published in: International Journal of Manpower, 2012, 33 (1), 96-117. Emerald Highly Commended Paper available on a free access here
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Other versions of this item:
- Corrado Giulietti & Guangjie Ning & Klaus F. Zimmermann, 2012. "Self-employment of rural-to-urban migrants in China," International Journal of Manpower, Emerald Group Publishing, vol. 33(1), pages 96-117, June.
- Giulietti, Corrado & Ning, Guangjie & Zimmermann, Klaus F, 2011. "Self-employment of rural-to-urban migrants in China," CEPR Discussion Papers 8473, C.E.P.R. Discussion Papers.
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-07-13 (All new papers)
- NEP-CNA-2011-07-13 (China)
- NEP-ENT-2011-07-13 (Entrepreneurship)
- NEP-IUE-2011-07-13 (Informal & Underground Economics)
- NEP-LAB-2011-07-13 (Labour Economics)
- NEP-LMA-2011-07-13 (Labor Markets - Supply, Demand, & Wages)
- NEP-MIG-2011-07-13 (Economics of Human Migration)
- NEP-SEA-2011-07-13 (South East Asia)
- NEP-TRA-2011-07-13 (Transition Economics)
- NEP-URE-2011-07-13 (Urban & Real Estate Economics)
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