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The Effect of Labor Mobility Restrictions on Human Capital Accumulation in China

  • Yao Pan

    ()

    (Institute for International Economic Policy, George Washington University)

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The Hukou system restricts rural-urban migration in China. This paper proposes positive impact of the Hukou system on education: rural people have stronger incentives to pursue higher education, treating it as a means to obtain urban identity and escape from under-developed areas. Applying the weighted sharp estimator developed in this study for regression discontinuity design, I find the human capital decreased sharply, when the mobility restriction was removed. These results reveal the important role of the Hukou system on encouraging educational investment in the presence of education-based selective migration in China.

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File URL: http://www.gwu.edu/~iiep/assets/docs/papers/Pan_IIEPWP2012-05.pdf
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Paper provided by The George Washington University, Institute for International Economic Policy in its series Working Papers with number 2012-5.

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Length: 56 pages
Date of creation: Apr 2012
Date of revision:
Handle: RePEc:gwi:wpaper:2012-5
Contact details of provider: Web page: http://www.gwu.edu/~iiep/
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