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Migration Decision and Rural Income Inequality in Northwestern China

Listed author(s):
  • Hua, Yue
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    Using rural household survey data from northwestern China, this study examines the decision between internal migration and home production for rural households and its impact on rural income distribution. By constructing counterfactual scenarios under which households are allowed to switch freely between internal migration and home production, this study finds that the migrant households in the studied region could have earned more had they choose not to migrate and work in local sectors, given the results that show remittances earned by the migrant households are less than their simulated home production earnings. The findings also illustrate that there would also be less income inequality in this area if migrants choose to work locally. These results are compatible with the fact that the internal migration in the study area is very likely to be involuntary, primarily due to the lack of arable land and insufficient local nonfarm job opportunities, usually provided by township and village enterprises

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    File URL: https://mpra.ub.uni-muenchen.de/61604/1/MPRA_paper_61604.pdf
    File Function: original version
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    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 61604.

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    Date of creation: 10 Jul 2014
    Date of revision: 20 Nov 2015
    Handle: RePEc:pra:mprapa:61604
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    1. Du, Yang & Park, Albert & Wang, Sangui, 2005. "Migration and rural poverty in China," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 688-709, December.
    2. Stark, Oded & Helmenstein, Christian & Prskawetz, Alexia, 1997. "A brain gain with a brain drain," Economics Letters, Elsevier, vol. 55(2), pages 227-234, August.
    3. Zhao, Yaohui, 1999. "Labor Migration and Earnings Differences: The Case of Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 47(4), pages 767-782, July.
    4. Chinmay, Tumbe, 2011. "Remittances in India: Facts and Issues," MPRA Paper 29983, University Library of Munich, Germany.
    5. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    6. Stark, Oded & Taylor, J. Edward & Yitzhaki, Shlomo, 1988. "Migration, remittances and inequality : A sensitivity analysis using the extended Gini index," Journal of Development Economics, Elsevier, vol. 28(3), pages 309-322, May.
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