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Are All Migrants Really Worse Off in Urban Labour Markets? New Empirical Evidence from China

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Author Info

  • Gagnon, Jason

    ()
    (OECD and Paris School of Economics)

  • Xenogiani, Theodora

    ()
    (OECD)

  • Xing, Chunbing

    ()
    (Beijing Normal University)

Abstract

The rapid and massive increase of rural-to-urban migration in China has drawn attention to the welfare of migrant workers, particularly to their working conditions and pay. This paper uses data from a random draw of the 2005 Chinese national census survey to investigate discrimination in urban labour markets against rural migrants, by comparing their earnings and the sector (formal vs. informal) they work in with those of urban residents and urban migrants. Exploiting differences in their status in the Chinese residential registration system (hukou) we find no earnings discrimination against rural migrants compared with urban residents, contrary to popular belief. In contrast, we find that urban migrants in fact gain a large wage premium by migrating. However, both rural and urban migrants are found to be discriminated out of the formal sector, working in informal jobs and lacking adequate social protection.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6268.

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Length: 31 pages
Date of creation: Dec 2011
Date of revision:
Handle: RePEc:iza:izadps:dp6268

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Keywords: migration; China; discrimination; informal employment;

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References

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  1. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
  2. Zhong Zhao, 2005. "Migration, Labor Market Flexibility, and Wage Determination in China: A Review," Labor and Demography, EconWPA 0507009, EconWPA.
  3. Margaret Maurer-Fazio & Ngan Dinh, 2004. "Differential rewards to, and contributions of, education in urban China's segmented labor markets," Pacific Economic Review, Wiley Blackwell, Wiley Blackwell, vol. 9(3), pages 173-189, October.
  4. Sylvie Démurger & Marc Gurgand & Li Shi & Yue Ximing, 2008. "Migrants as second-class workers in urban China? A decomposition analysis," PSE Working Papers halshs-00586783, HAL.
  5. Meng, Xin & Miller, Paul, 1995. "Occupational Segregation and Its Impact on Gender Wage Discrimination in China's Rural Industrial Sector," Oxford Economic Papers, Oxford University Press, vol. 47(1), pages 136-55, January.
  6. repec:pse:psecon:2008-20 is not listed on IDEAS
  7. Lin, Justin Y & Wang, Gewei & Zhao, Yaohui, 2004. "Regional Inequality and Labor Transfers in China," Economic Development and Cultural Change, University of Chicago Press, vol. 52(3), pages 587-603, April.
  8. Knight, John & Li, Shi, 2005. "Wages, firm profitability and labor market segmentation in urban China," China Economic Review, Elsevier, Elsevier, vol. 16(3), pages 205-228.
  9. Jason Gagnon & Theodora Xenogiani & Chunbing Xing, 2009. "Are all Migrants Really Worse off in Urban Labour Markets?: New empirical evidence from China," OECD Development Centre Working Papers 278, OECD Publishing.
  10. Zheren WU, 2008. "Self-selection and Earnings of Migrants: Evidence from Rural China," Discussion Papers in Economics and Business 08-25, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
  11. John Knight & Linda Yueh, 2004. "Urban Insiders versus Rural Outsiders: Complementarity or Competition in China`s Urban Labour Market?," Economics Series Working Papers 217, University of Oxford, Department of Economics.
  12. WANG Tianhong & Atsushi MARUYAMA & Masao KIKUCHI, 2000. "Rural-Urban Migration And Labor Markets In China: A Case Study In A Northeastern Province," The Developing Economies, Institute of Developing Economies, vol. 38(1), pages 80-104, 03.
  13. Knight, John & Yueh, Linda, 2004. "Job mobility of residents and migrants in urban China," Journal of Comparative Economics, Elsevier, vol. 32(4), pages 637-660, December.
  14. John Whalley & Shunming Zhang, 2004. "Inequality Change in China and (Hukou) Labour Mobility Restrictions," NBER Working Papers 10683, National Bureau of Economic Research, Inc.
  15. Meng, Xin & Zhang, Junsen, 2001. "The Two-Tier Labor Market in Urban China: Occupational Segregation and Wage Differentials between Urban Residents and Rural Migrants in Shanghai," Journal of Comparative Economics, Elsevier, vol. 29(3), pages 485-504, September.
  16. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
  17. Zhang, Kevin Honglin & Song, Shunfeng, 2003. "Rural-urban migration and urbanization in China: Evidence from time-series and cross-section analyses," China Economic Review, Elsevier, Elsevier, vol. 14(4), pages 386-400.
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Cited by:
  1. Cui, Yuling & Nahm, Daehoon & Tani, Massimiliano, 2012. "The Determinants of Rural Migrants' Employment Choice in China: Results from a Joint Estimation," IZA Discussion Papers 6968, Institute for the Study of Labor (IZA).
  2. Wenshu Gao & Russell Smyth, 2012. "Returns to Schooling in Urban China, 2001-2010: Evidence from Three Waves of the China Urban Labor Survey," Development Research Unit Working Paper Series, Monash University, Department of Economics 50-12, Monash University, Department of Economics.
  3. Gagnon, Jason & Xenogiani, Theodora & Xing, Chunbing, 2011. "Are All Migrants Really Worse Off in Urban Labour Markets? New Empirical Evidence from China," IZA Discussion Papers 6268, Institute for the Study of Labor (IZA).
  4. Danzer, Alexander M. & Dietz, Barbara & Gatskova, Ksenia & Schmillen, Achim, 2013. "Showing off to the new neighbors? Income, socioeconomic status and consumption patterns of internal migrants," Munich Reprints in Economics, University of Munich, Department of Economics 20029, University of Munich, Department of Economics.
  5. Corrado Giulietti & Guangjie Ning & Klaus F. Zimmermann, 2012. "Self-employment of rural-to-urban migrants in China," International Journal of Manpower, Emerald Group Publishing, Emerald Group Publishing, vol. 33(1), pages 96-117, June.
  6. Ariga, Kenn & Ohtake, Fumio & Sasaki, Masaru & Wu, Zheren, 2012. "Wage Growth through Job Hopping in China," IZA Discussion Papers 7104, Institute for the Study of Labor (IZA).
  7. Fields, Gary S. & Song, Yang, 2013. "A Theoretical Model of the Chinese Labor Market," IZA Discussion Papers 7278, Institute for the Study of Labor (IZA).
  8. Cui, Yuling & Nahm, Daehoon & Tani, Massimiliano, 2013. "Self-Employment in China: Are Rural Migrant Workers and Urban Residents Alike?," IZA Discussion Papers 7191, Institute for the Study of Labor (IZA).

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