IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Relaxing Hukou: Increased labor mobility and China’s economic geography

  • Bosker, Maarten
  • Brakman, Steven
  • Garretsen, Harry
  • Schramm, Marc

China’s Hukou system poses severe restrictions on labor mobility. This paper assesses the possible consequences of relaxing these restrictions for China’s internal economic geography. We base our analysis on a new economic geography (NEG) model. First, we estimate the important model parameters using data on 264 of China’s prefecture cities. Second, we use these estimates as inputs in a simulation of the full NEG model under different labor mobility regimes. We find that increased labor mobility leads to more pronounced core–periphery outcomes. Beijing, Shanghai, Guangzhou and Chongqing in particular will further strengthen their dominant place in China’s urban hierarchy. In addition, two other groups of cities can be distinguished: those in China’s populous heartland offering preferential access to China’s enormous internal market, and more peripheral cities that are better shielded from competition with China’s economic heartland by virtue of their relative remoteness.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/pii/S0094119012000411
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 72 (2012)
Issue (Month): 2 ()
Pages: 252-266

as
in new window

Handle: RePEc:eee:juecon:v:72:y:2012:i:2:p:252-266
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622905

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Alyson C. Ma, 2006. "Geographical Location of Foreign Direct Investment and Wage Inequality in China," The World Economy, Wiley Blackwell, vol. 29(8), pages 1031-1055, 08.
  2. Diego Puga, 1996. "The Rise and Fall of Regional Inequalities," CEP Discussion Papers dp0314, Centre for Economic Performance, LSE.
  3. José De Sousa & Sandra Poncet, 2007. "How are Wages set in Beijing?," Working Papers 2007-13, CEPII research center.
  4. Stephen Redding & Anthony J. Venables, 2001. "Economic geography and international inequality," LSE Research Online Documents on Economics 3714, London School of Economics and Political Science, LSE Library.
  5. Fujita, Masahisa & Mori, Tomoya & Henderson, J. Vernon & Kanemoto, Yoshitsugu, 2004. "Spatial distribution of economic activities in Japan and China," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 65, pages 2911-2977 Elsevier.
  6. Amiti, Mary & Smarzynska Javorcik, Beata, 2008. "Trade costs and location of foreign firms in China," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 129-149, February.
  7. Behrens, Kristian & Thisse, Jacques-Francois, 2007. "Regional economics: A new economic geography perspective," Regional Science and Urban Economics, Elsevier, vol. 37(4), pages 457-465, July.
  8. Head, Keith & Mayer, Thierry, 2004. "The empirics of agglomeration and trade," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 59, pages 2609-2669 Elsevier.
  9. Maarten Bosker & Harry Garretsen, 2010. "Trade costs in empirical New Economic Geography," Papers in Regional Science, Wiley Blackwell, vol. 89(3), pages 485-511, 08.
  10. Steven Brakman & Harry Garretsen & Marc Schramm, 2004. "The Spatial Distribution of Wages: Estimating the Helpman-Hanson Model for Germany," Journal of Regional Science, Wiley Blackwell, vol. 44(3), pages 437-466.
  11. Krugman, Paul, 1993. "On the number and location of cities," European Economic Review, Elsevier, vol. 37(2-3), pages 293-298, April.
  12. Chun-Chung Au & J. Vernon Henderson, 2006. "Are Chinese Cities Too Small?," Review of Economic Studies, Oxford University Press, vol. 73(3), pages 549-576.
  13. Fujita, Masahisa & Mori, Tomoya, 2005. "Frontiers of the New Economic Geography," IDE Discussion Papers 27, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  14. repec:cup:cbooks:9780521875325 is not listed on IDEAS
  15. Venables, Anthony J, 1993. "Equilibrium Locations of Vertically Linked Industries," CEPR Discussion Papers 802, C.E.P.R. Discussion Papers.
  16. H. Hanson, Gordon, 2005. "Market potential, increasing returns and geographic concentration," Journal of International Economics, Elsevier, vol. 67(1), pages 1-24, September.
  17. Poncet, Sandra, 2006. "Provincial migration dynamics in China: Borders, costs and economic motivations," Regional Science and Urban Economics, Elsevier, vol. 36(3), pages 385-398, May.
  18. Paul Krugman, 2011. "The New Economic Geography, Now Middle-aged," Regional Studies, Taylor & Francis Journals, vol. 45(1), pages 1-7.
  19. Laura Hering & Sandra Poncet, 2007. "Economic Geography, Spatial Dependence and Income Inequality in China," Working Papers 2007-22, CEPII research center.
  20. Knaap, Thijs, 2006. "Trade, location, and wages in the United States," Regional Science and Urban Economics, Elsevier, vol. 36(5), pages 595-612, September.
  21. Krugman, Paul & Venables, Anthony J., 1995. "Globalization and the Inequality of Nations," Working Paper Series 430, Research Institute of Industrial Economics.
  22. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June.
  23. Chun-Chung Au & Vernon Henderson, 2002. "How Migration Restrictions Limit Agglomeration and Productivity in China," NBER Working Papers 8707, National Bureau of Economic Research, Inc.
  24. Zhang, Junfu & Zhao, Zhong, 2013. "Measuring the Income-Distance Tradeoff for Rural-Urban Migrants in China," IZA Discussion Papers 7160, Institute for the Study of Labor (IZA).
  25. Laura Hering & Sandra Poncet, 2010. "Income per capita inequality in China: The Role of Economic Geography and Spatial Interactions," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00633899, HAL.
  26. J.V. Henderson, 1972. "The Sizes and Types of Cities," Working Papers 75, Queen's University, Department of Economics.
  27. Hu, Dapeng, 2002. "Trade, rural-urban migration, and regional income disparity in developing countries: a spatial general equilibrium model inspired by the case of China," Regional Science and Urban Economics, Elsevier, vol. 32(3), pages 311-338, May.
  28. Maarten Bosker & Steven Brakman & Harry Garretsen & Marc Schramm, 2007. "Adding Geography to the New Economic Geography," CESifo Working Paper Series 2038, CESifo Group Munich.
  29. Zhong Zhao, 2005. "Migration, Labor Market Flexibility, and Wage Determination in China: A Review," Labor and Demography 0507009, EconWPA.
  30. Brakman, Steven & Garretsen, Harry & Schramm, Marc, 2005. "Putting new economic geography to the test: free-ness of trade and agglomeration in the EU regions," CCSO Working Papers 200502, University of Groningen, CCSO Centre for Economic Research.
  31. José De Sousa & Sandra Poncet, 2011. "How are wages set in Beijing," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00633752, HAL.
  32. Ana Isabel Moreno‐Monroy, 2011. "Market access and the heterogeneous effect of shocks on wages: Evidence from Chinese cities," Papers in Regional Science, Wiley Blackwell, vol. 90(1), pages 9-25, 03.
  33. Matthieu Crozet, 2004. "Do Migrants Follow Market Potentials? An Estimation of a New Economic Geography Model," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00096277, HAL.
  34. repec:cup:cbooks:9780521698030 is not listed on IDEAS
  35. Whalley, John & Zhang, Shunming, 2007. "A numerical simulation analysis of (Hukou) labour mobility restrictions in China," Journal of Development Economics, Elsevier, vol. 83(2), pages 392-410, July.
  36. Laura Hering & Sandra Poncet, 2010. "Market Access and Individual Wages: Evidence from China," The Review of Economics and Statistics, MIT Press, vol. 92(1), pages 145-159, February.
  37. Maarten Bosker & Steven Brakman & Harry Garretsen & Marc Schramm, 2010. "Adding geography to the new economic geography: bridging the gap between theory and empirics," Journal of Economic Geography, Oxford University Press, vol. 10(6), pages 793-823, November.
  38. repec:use:tkiwps:0530 is not listed on IDEAS
  39. Laura Hering & Sandra Poncet, 2010. "Market access and individual wages: evidence from China," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00633785, HAL.
  40. Laura Hering & Sandra Poncet, 2010. "Income Per Capita Inequality in China: The Role of Economic Geography and Spatial Interactions," The World Economy, Wiley Blackwell, vol. 33(5), pages 655-679, 05.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:juecon:v:72:y:2012:i:2:p:252-266. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.