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Migrants as second-class workers in urban China? A decomposition analysis

Author

Listed:
  • Sylvie Démurger

    (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique)

  • Marc Gurgand

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique, PJSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

  • Li Shi

    (School of Economics and Business - BNU - Beijing Normal University)

  • Yue Ximing

    (School of Finance - Renmin University of China)

Abstract

In urban China, urban resident annual earnings are 1.3 times larger than long term rural migrant earnings as observed in a nationally representative sample in 2002. Using microsimulation, we decompose this difference into four sources, with particular attention to path dependence and statistical distribution of the estimated effects: (1) different allocation to sectors that pay different wages (sectoral effect); (2) hourly wage disparities across the two populations within sectors (wage effect); (3) different working times within sectors (hours effect); (4) different population structures (population effect). Although sector allocation is extremely contrasted, with very few migrants in the public sector and very few urban residents working as self-employed, this has no clear impact on differential earnings. Indeed, the sectoral effect is not robust to the path followed for the decomposition. We show that the migrant population has a comparative advantage in the private sector: increasing its participation into the public sector would not necessarily improve its average earnings. The second main finding is that the population effect is robust and significantly more important than wage or hours effects. This implies that the main source of disparity between the two populations is pre-market (education opportunities) rather than on-market.

Suggested Citation

  • Sylvie Démurger & Marc Gurgand & Li Shi & Yue Ximing, 2008. "Migrants as second-class workers in urban China? A decomposition analysis," Working Papers halshs-00586783, HAL.
  • Handle: RePEc:hal:wpaper:halshs-00586783
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00586783
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Chinese labor market; earnings differentials; migration; discrimination;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • P23 - Economic Systems - - Socialist Systems and Transition Economies - - - Factor and Product Markets; Industry Studies; Population

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