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Expropriation with Hukou Change: Evidence from a Quasi-Natural Experiment

Author

Listed:
  • Akgüc, Mehtap

    () (Center for European Policy Studies (CEPS))

  • Liu, Xingfei

    () (University of Alberta)

  • Tani, Massimiliano

    () (University of New South Wales)

Abstract

We study the labor market outcomes of males aged 18-60 obtaining an urban hukou as a result of land expropriation across a number of provinces in China. Using 2008 and 2009 RUMiC data pooling urban, rural and migrant samples, we find that those obtaining an urban hukou have better labour market outcomes than rural stayers and migrants, and close the gap vis-à-vis native urbanites. We also find that children of families experiencing a hukou change due to expropriation have similar investment in human capital as the children of native urban hukou holders. The results confirm the hukou status as a strong economic determinant of labor market outcomes and as a source of inequality. Differences in educational investment, regardless of the differences in parental background, appear however to disappear for the children of families experiencing expropriation, suggesting that leveling the hukou status amongst children in an urban area may be a first step towards reducing intergenerational inequality.

Suggested Citation

  • 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).
  • Handle: RePEc:iza:izadps:dp8689
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    References listed on IDEAS

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    1. Zhang, Xiaobo & Kanbur, Ravi, 2005. "Spatial inequality in education and health care in China," China Economic Review, Elsevier, vol. 16(2), pages 189-204.
    2. Xin Meng, 2012. "Labor Market Outcomes and Reforms in China," Journal of Economic Perspectives, American Economic Association, vol. 26(4), pages 75-102, Fall.
    3. Kuhn, Peter J. & Shen, Kailing, 2014. "Do Employers Prefer Undocumented Workers? Evidence from China's Hukou System," IZA Discussion Papers 8289, Institute for the Study of Labor (IZA).
    4. Corrado Giulietti & Guangjie Ning & Klaus F. Zimmermann, 2012. "Self-employment of rural-to-urban migrants in China," International Journal of Manpower, Emerald Group Publishing, vol. 33(1), pages 96-117, March.
    5. Xiuqing Zou & Arie J. Oskam, 2007. "New Compensation Standard for Land Expropriation in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 15(5), pages 107-120.
    6. Fang Cai, 2011. "Hukou System Reform and Unification of Rural–urban Social Welfare," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 19(3), pages 33-48, May.
    7. Ran Tao & Zhigang Xu, 2007. "Urbanization, rural land system and social security for migrants in China," Journal of Development Studies, Taylor & Francis Journals, vol. 43(7), pages 1301-1320.
    8. Paul Frijters & Leng Lee & Xin Meng, 2010. "Jobs, Working Hours and Remuneration Packages for Migrant and Urban Workers," Chapters,in: The Great Migration, chapter 3 Edward Elgar Publishing.
    9. Hanan G. Jacoby & Guo Li & Scott Rozelle, 2002. "Hazards of Expropriation: Tenure Insecurity and Investment in Rural China," American Economic Review, American Economic Association, vol. 92(5), pages 1420-1447, December.
    10. Mullan, Katrina & Grosjean, Pauline & Kontoleon, Andreas, 2011. "Land Tenure Arrangements and Rural-Urban Migration in China," World Development, Elsevier, vol. 39(1), pages 123-133, January.
    11. 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.
    12. Xiaobing Wang & Nick Weaver, 2013. "Surplus Labour and Urbanization in China," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 3(1), pages 84-97, June.
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    Cited by:

    1. repec:spr:soinre:v:132:y:2017:i:1:d:10.1007_s11205-016-1247-z is not listed on IDEAS
    2. Akgüç, Mehtap & Liu, Xingfei & Tani, Massimiliano & Zimmermann, Klaus F., 2016. "Risk attitudes and migration," China Economic Review, Elsevier, vol. 37(C), pages 166-176.
    3. Tani, Massimiliano, 2015. "Hukou Changes and Subjective Well-Being," IZA Discussion Papers 9451, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    expropriation; China; labour markets; economic reform; quasi-experiment;

    JEL classification:

    • D19 - Microeconomics - - Household Behavior - - - Other
    • H13 - Public Economics - - Structure and Scope of Government - - - Economics of Eminent Domain; Expropriation; Nationalization
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General

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