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Self-employment of rural-to-urban migrants in China


  • Giulietti, Corrado
  • Ning, Guangjie
  • Zimmermann, Klaus F


This 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.

Suggested Citation

  • 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.
  • Handle: RePEc:cpr:ceprdp:8473

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    References listed on IDEAS

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    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Zheng, Liang & Zhao, Zhong, 2017. "What drives spatial clusters of entrepreneurship in China? Evidence from economic census data," China Economic Review, Elsevier, vol. 46(C), pages 229-248.
    2. Elaine Liu & Paul Frijters & Tao Sherry Kong, 2013. "Who is Coming to the Experiment? A Cautionary Tale from China," Working Papers 201309854, Department of Economics, University of Houston.
    3. Song, Yang, 2014. "What should economists know about the current Chinese hukou system?," China Economic Review, Elsevier, vol. 29(C), pages 200-212.
    4. Mehtap Akgüç & Corrado Giulietti & Klaus Zimmermann, 2014. "The RUMiC longitudinal survey: fostering research on labor markets in China," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-14, December.
    5. Junfu Zhang & Zhong Zhao, 2015. "Social-family network and self-employment: evidence from temporary rural–urban migrants in China," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-21, December.
    6. repec:wsi:serxxx:v:62:y:2017:i:02:n:s0217590815500885 is not listed on IDEAS
    7. 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).
    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).
    9. Giulietti, Corrado & Wahba, Jackline & Zimmermann, Klaus F., 2013. "Entrepreneurship of the Left-Behind," IZA Discussion Papers 7270, Institute for the Study of Labor (IZA).
    10. Akgüc, Mehtap & Liu, Xingfei & Tani, Massimiliano, 2014. "Expropriation with Hukou Change: Evidence from a Quasi-Natural Experiment," IZA Discussion Papers 8689, Institute for the Study of Labor (IZA).
    11. 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).
    12. Peter Simmons & Yuanyuan Xie, 2013. "Three musketeers: A dynamic model of capital inflow (FDI), the real wage rate and the net migration flow with empirical application," Discussion Papers 13/28, Department of Economics, University of York.
    13. Villalobos Barría, Carlos & Klasen, Stephan, 2016. "The impact of SENAI's vocational training program on employment, wages, and mobility in Brazil: Lessons for Sub Saharan Africa?," The Quarterly Review of Economics and Finance, Elsevier, vol. 62(C), pages 74-96.

    More about this item


    European Union; rural to urban migration; selection bias magnets; self-employment; wages;

    JEL classification:

    • 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, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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