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Human Capital and Urbanization in the People’s Republic of China

Author

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  • Xing, Chunbing

    (Asian Development Bank Institute)

Abstract

The relationship between human capital development and urbanization in the People’s Republic of China (PRC) is explored, highlighting the institutional factors of the hukou system and a decentralized fiscal system. Educated workers disproportionately reside in urban areas and in large cities. Returns to education are significantly higher in urban areas relative to those in rural areas, as well as in large, educated cities relative to small, less-educated cities. In addition, the external returns to education in urban areas are at least comparable to the magnitude of private returns. Rural areas are the major reservoir for urban population growth, and the more educated have a higher chance of moving to cities and obtaining urban hukou. Relaxing the hukou restriction, increasing education levels of rural residents, providing training for rural–urban migrants, and guaranteeing equal opportunity for all residents are necessary for a sustainable urbanization process in the PRC. In terms of health, rural–urban migration is selective in that healthy rural residents choose to migrate. Occupational choices and living conditions are detrimental to migrants’ health, however. While migration has a positive effect on migrant children, its effect on “left-behind” children is unclear.

Suggested Citation

  • Xing, Chunbing, 2016. "Human Capital and Urbanization in the People’s Republic of China," ADBI Working Papers 603, Asian Development Bank Institute.
  • Handle: RePEc:ris:adbiwp:0603
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    References listed on IDEAS

    as
    1. Xin Meng & Kailing Shen & Sen Xue, 2010. "Economic Reform, Education Expansion, and Earnings Inequality for Urban Males in China, 1988-2007," CEPR Discussion Papers 639, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    2. Margaret Maurer-Fazio & Ngan Dinh, 2004. "Differential rewards to, and contributions of, education in urban China's segmented labor markets," Pacific Economic Review, Wiley Blackwell, vol. 9(3), pages 173-189, October.
    3. Meng, Xin & Zhang, Junsen, 2001. "The Two-Tier Labor Market in Urban China: Occupational Segregation and Wage Differentials between Urban Residents and Rural Migrants in Shanghai," Journal of Comparative Economics, Elsevier, vol. 29(3), pages 485-504, September.
    4. Xiaogang Wu & Donald Treiman, 2004. "The household registration system and social stratification in China: 1955–1996," Demography, Springer;Population Association of America (PAA), vol. 41(2), pages 363-384, May.
    5. Jason Gagnon & Theodora Xenogiani & Chunbing Xing, 2014. "Are migrants discriminated against in Chinese urban labour markets?," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-23, December.
    6. Topel, Robert H, 1986. "Local Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 111-143, June.
    7. Chun-Chung Au & J. Vernon Henderson, 2006. "Are Chinese Cities Too Small?," Review of Economic Studies, Oxford University Press, vol. 73(3), pages 549-576.
    8. Chen, Yuanyuan & Feng, Shuaizhang, 2013. "Access to public schools and the education of migrant children in China," China Economic Review, Elsevier, vol. 26(C), pages 75-88.
    9. John WHALLEY & Chunbing XING, 2014. "The regional distribution of skill premia in urban China: Implications for growth and inequality," International Labour Review, International Labour Organization, vol. 153(3), pages 395-419, September.
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    1. repec:eee:chieco:v:51:y:2018:i:c:p:181-193 is not listed on IDEAS

    More about this item

    Keywords

    Human capital; health; education; development; hukou system; urbanization;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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