Occupational attainment and stratification in China: The interactive effects of social networks and the hukou system

This paper examines the effects of social networks and hukou status on worker’s occupational attainment in China. To identify the potential ranking of different occupations, we consider the use of the stereotype ordered regression model to estimate individual occupational choice. Our results show that social networks play different roles in shaping occupational outcomes for urban and rural workers. In particular, friendship ties significantly improve urban workers’ opportunities in obtaining higher‐ranked occupations; in contrast, kinship ties appear to be more influential for rural migrants, but the effects are limited to the attainment of lower‐ranked occupations. While social contacts from government organizations or state‐owned sectors facilitate urban workers’ attainment of higher‐ranked occupations, similar patterns are not observed among rural workers. We further find that the beneficial effects of social networks or urban hukou identity are stronger for workers who are from less‐developed regions, who work in state‐owned enterprises, or who have a college degree. Decomposition of the wage gap between urban and rural workers suggests that differences in social networks and occupation types, together with hukou discrimination, account for the majority of the current wage inequality.     

迁移、自选择与收入分配-来自中国城乡的证据

本文强调两个事实:第一,农村居民并非同质,他们根据自身的特征决定迁移与否;第二,那些成功地改变了户籍身份的永久移民与没能改变户籍身份的临时移民之间有着显著的差异。利用2002年的CHIP数据发现,永久移民的正选择效应非常明显,它使得农村地区教育水平较高、处于收入分布较高位置的样本减少。这导致农村的收入水平和农村内部的不平等程度降低,阻碍了城乡差距的降低。相反,临时移民的选择效应几乎可以忽略不计。     

MINIMUM WAGE EFFECTS ON PERMANENT VERSUS TEMPORARY MINIMUM WAGE EMPLOYMENT

We estimate the effect of minimum wages on employment using the Master Files of the Canadian Labour Force Survey over the recent period 1997–2008. Particular attention is paid to the differences between permanent and temporary minimum wage workers—an important distinction not made in the existing literature. Our estimates for permanent and temporary minimum wage workers combined are at the lower end of estimates based on Canadian studies estimated over earlier time periods, suggesting that the adverse employment effects are declining over time for reasons discussed. Importantly, the adverse employment effects are substantially larger for permanent compared to temporary minimum wage workers; in fact they fall almost exclusively on permanent minimum wage workers. (JEL J30)     

Comparing earnings profiles in urban areas of an LDC: rural-to-urban migrants vs. native workers

"We use Tanzanian data to test a recently proposed hypothesis that rural-to-urban migrants have an incentive to supply greater work effort than native urban workers, because of the migrants' positive probability of returning to the low-wage rural areas. We treat the choice between public- and private-sector employment as endogenous and, for theoretical and empirical reasons, distinguish migrants with access to rural land from those without access. Our results show that migrants in both sectors face lower initial wage offers than native urban workers. But, the wage gap is eliminated within a decade or less, and thereafter, migrants surpass the wage offers of native workers."     

Modeling migration barriers in a two-sector framework: A welfare analysis of the hukou reform in China

The present paper constructs a two-sector labor market model for China featuring endogenous internal labor mobility and heterogeneous costs of migration induced by the Chinese household registration system (hukou). The main novelty of our model is to divide migrants into those with more family responsibilities and those with fewer to explain the empirical fact that almost all young people with rural hukou have migrated to cities, while people who stay in the rural area are older and have more family responsibilities. We conduct two policy experiments using the model: one experiment concerned with reducing costs of living for younger migrants and the other for older migrants. The main results are that the first policy would unambiguously increase social welfare, while the reduced-cost policy for older migrants would reduce poverty and inequality although some urban natives may experience a wage reduction.     

中国的永久移民

中国的户口制度阻碍了农村居民向城市的迁移。然而,农村居民仍能通过接受较好的教育、提干或参军等方式获得城市户口。利用2002年的大样本调查,我们发现永久移民的数量大约为1亿,约占现今城市居民的20%。与留在农村的农民相比,永久移民的经济状况得到了很大的改善。成为永久移民的概率与父母教育水平、汉族身份、父母党员身份等正相关。永久移民的经济状况与获得户口时的年龄有关。较年轻时就获得户口的永久移民的收入要高于城市原住民,较晚获得户口的永久移民的收入则要低于城市原住民。尽管大部分永久移民成功地融入了城市生活,但那些通过非职业途径获得户口的永久移民,却远非如此。     

Appropriation,migration, and unemployment

This article builds general equilibrium models to explore the relationship among appropriation, rural–urban migration, the minimum wage and unemployment. We find that the proportion of appropriated capital plays a key role in the effects of appropriation on unemployment and rural–urban migration. When the proportion of appropriated capital is large, a stronger control on appropriation by the government results in a lower unemployment rate and more rural–urban migrants, and vice versa. In the extended models, the conclusion may be different when the plundered factor changes from capital to land. In the situation with the agricultural sector employing unskilled labour and capital, appropriation has no impact on unemployment, and the effect on migration remains the same. We also discuss the implications of the minimum wage, and find that under plausible conditions, the rise of the minimum wage can alleviate appropriation and reduce unemployment. The situation of migration is ambiguous due to the impacts of two opposite factors.     

Temporary and permanent migrant selection: Theory and evidence of ability‐search cost dynamics

We integrate two workhorses of the labor literature, the Roy and search models, to illustrate the implications of migration duration—specifically, whether it is temporary or permanent—for patterns of selection. Consistent with our stylized model, we show that temporary migrants are intermediately selected on education, with weaker selection on cognitive ability. In contrast, permanent migration is associated with strong positive selection on both education and ability, as it involves finer employee–employer matching and offers greater returns to experience. Networks are also more valuable for permanent migration, where search costs are higher. Labor market frictions explain observed network–skill interactions.     

迁移类型、户籍身份与工资收入水平*

本文基于2013年中国居民收入调查数据（CHIP）,考察各类迁移对工资收入水平的影响。OLS及PSM估计结果均表明各类迁移有利于工资收入水平的提升;采用局部工具变量法进行稳健性检验,发现本文的研究结论依然成立。分迁移范围来看,市外迁移的平均收入增长效应大于市内迁移的平均收入增长效应;分户籍类型来看,农村户籍迁移的平均收入增长效应大于城市户籍的平均收入增长效应。综合比较各种迁移类型的收入增长效应,由强至弱可以将其排列为：永久移民市外迁移、农村户籍市外迁移、本地居民市外迁移、城市户籍市外迁移、农村户籍市内迁移、城市户籍市内迁移、本地居民市内迁移、永久移民市内迁移。城市化的核心在于满足居民的自由迁移意愿,从本文的研究结论来看,鼓励就近城市化而妨碍人口跨区域流动的城市化模式尚未得到收入增长激励的支撑。在推动户籍制度改革及公共服务均等化的同时,应注重建立全国统一的要素市场,进一步完善城市的空间结构体系。     

Migrants’ well-being during the global financial crisis: Economic and social predictors

This paper investigates the economic and social predictors affecting the well-being of temporary migrants before, during and after the financial crisis. Exploiting unique panel data which cover migration spells from Tajikistan to Russia between 2001 and 2011, we find that migrants earn less but stay longer in the destination during the crisis; at the same time, they become more exposed to illegal work relations, harassment and deportation through the Russian authorities. The overall income loss can be attributed to wage cuts and to rising illegal employment that is generally poorly paid. Despite the similarities in the demographics and jobs of migrant workers, we find substantial heterogeneity in how the financial crisis affects their well-being. Migrants who experience wage losses during the crisis rationally stop migrating.     

The selection of migrants and returnees in Romania

This paper uses census and survey data to identify the wage earning ability and the selection of recent Romanian migrants and returnees on observable characteristics. We construct measures of selection across skill groups and estimate the average and the skill‐specific premium for migration and return for three typical destinations of Romanian migrants after 1990. Once we account for migration costs, we find evidence that the selection and sorting of migrants are driven by different returns to skills in countries of destination. Our identification strategy for the effects of work experience abroad permits a cautious causal interpretation of the premium to return migration. This premium increases with migrants' skills and drives the positive selection of returnees relative to non‐migrants. Based on the compatibility of the results with rationality in the migration decisions, we simulate a rational‐agent model of education, migration and return. Our results suggest that for a source country like Romania relatively high rates of temporary migration might have positive long‐run effects on average skills and wages.     

Wage inequality and between-firm wage dispersion in the 1990s: A comparison of rural and urban enterprises in China

Using a worker–firm matched sample, this paper compares the changes of wage structures of urban and rural enterprises following public sector restructuring in China's manufacturing sector. While the wage responses of rural firms with respect to firm characteristics are found to have declined steadily, compensation of urban workers has become increasingly linked to their firms' ability to pay. Our analysis reveals that industrial restructuring has weakened the influence of institutional factors, such as market power, soft budget constraints, and insider influence, on the wage determination of rural firms but it has enhanced their impact on urban firms. Journal of Comparative Economics 33 (4) (2005) 664–687.     

Work Effort, Moderation in Expulsion, and Illegal Migration

Illegal migrants supply a valuable productive input: effort. But their status as illegals means that these migrants face a strictly positive probability of expulsion. A return to their country of origin entails reduced earnings when the wage at origin is lower than the wage at destination. This prospect induces illegal migrants to exert more work effort than comparable workers who face no such prospect. The lower the probable, alternative earnings, the harsher the penalty that illegal migrants will be subjected to upon their return, for a given probability of expulsion, and the higher the level of effort they will exert at destination. While the home‐country wage that awaits the illegal migrants upon their return is exogenous to the host country, the probability of their return is not. Given the home‐country wage, a higher probability of expulsion will induce illegal migrants to supply more effort. Hence, different combinations of probabilities of expulsion and home‐country wages yield the same level of effort. Thus, variation in the extent to which receiving countries undertake measures aimed at apprehending and expelling illegal migrants can be attributed not to characteristics of the illegal migrants themselves but to a feature that pertains to the illegal migrants’ country of origin.     

The gender wage gap among China’s rural–urban migrants

In this study, we present new empirical evidence on gender wage differences among rural–urban migrants in China. We use a data set that includes migrants residing in urban communities and those living at their workplaces—the latter were not included in the previous studies. We find that the gender wage gap among migrants is 16%–18% and does not differ between migrants living at workplaces and those living in urban communities. However, gender differences in industry sorting play a more important role for migrants living at their workplaces, whereas differences in education and experience are of importance for those living in urban communities. Overall, differences in the returns to characteristics are the main driver of the gender wage gap, especially for migrants living in urban communities.     

Part‐Peasants: Incomplete Rural–Urban Labour Migration in China

The institutional settings in China, including the land allocation system and the household registration system, lead to a rural–urban labour migration pattern that differs from that in other countries. Individual peasants' labour is often split (typically over different times of the year) into two or more parts as a result of institutional factors. Individuals work both as peasants on the land and as temporary migrant workers in urban areas (or in rural non‐agricultural sectors). We examine this issue using province‐level panel data. The present study provides a new interpretation of the phenomenon of labour shortages in coastal cities and rising rural migrant wages in China in recent years, and discusses whether the Lewisian turning point has been reached. Under part migration, the rural labour supply to urban areas is smaller than would be the case with full migration of workers to urban areas, so that the Lewisian turning point occurs earlier. This finding has important policy implications for China's future development.     

Wage and Mobility Effects of Trade and Migration on the Austrian Labour Market

This study analyses the effect of trade and migration on wages and labour marketmobility. We estimate wage growth equations and a multinomial logit mobilityequation on an individual data set ranging from 1991 to 1994. We find substantialdifferences in the reactions of white and blue-collar workers wages and mobilityto trade and migration. In Austria exports have a positive and imports a negativeimpact on wage growth only for blue-collar workers. Migrants also reduce onlyblue-collar workers wage growth. Our results indicate that higher imports and aninflow of migrants reduce sectoral mobility of all types workers. The risk of beingout of work by contrast is increased by migration and imports only for blue-collarworkers, but reduced by exports for all types of workers. In general our results suggestenlargement of the EU would have only small effects on the Austrian labour market.     

Rural-to-urban migration, human capital, and agglomeration

A new general-equilibrium model that links together rural-to-urban migration, the externality effect of the average level of human capital, and agglomeration economies shows that in developing countries, unrestricted rural-to-urban migration reduces the average income of both rural and urban dwellers in equilibrium. Various measures aimed at curtailing rural-to-urban migration by unskilled workers can lead to a Pareto improvement for both the urban and rural dwellers. In addition, the government can raise social welfare by reducing the migration of skilled workers to the city. Moreover, without a restriction on rural-to-urban migration, a government's efforts to increase educational expenditure and thereby the number of skilled workers may not increase wage rates in the rural or urban areas.     

Starting Your Career With a Fixed-Term Job: Stepping-Stone or “Dead End”?

This paper uses panel data from the UK and Germany to investigate the difference in the learning effect between workers who enter the labour market with a fixed term and a permanent job. Our results verify the existence of a wage penalty for entering the labour market with a fixed-term contract for the British males (7.1%) and especially for the British females (21.2%). British females also have a very strong learning effect that is especially large for temporary starters. In Germany, the initial wage penalty for temporary starters is smaller than in the UK—4.5% for the males and 3% for the females—and is persistent only for the males. Although initial wage differences are mitigated through the accumulation of skills on the job, this process differs between temporary and permanent starters. This suggests that the type of the starting contract may be a feature of labour market segmentation.     

Who stays,who goes,who returns?

We study the determinants of East–West migration within Germany during the period 1990–2006, using administrative data, the German Microcensus and the German Socio‐Economic Panel. We find that in addition to income prospects and employment status, two well‐known determinants of migration, psychological and social factors play an important role in determining the migration decision. Men and women move from East to West in proportionate numbers, but among individuals who lived in the East in 1989 women are more likely to migrate. The migrant body in the second wave of migration, starting in the late 1990s, is increasingly composed of young, educated people. By focusing on differences between temporary and permanent migrants, we find that older and single individuals are more likely to return East than stay permanently in the West, compared with younger and married individuals. Finally, the life satisfaction of permanent migrants increases significantly after a move, while that of temporary migrants remains essentially flat.     

Income maximization and the selection and sorting of international migrants

Two prominent features of international labor movements are that the more educated are more likely to emigrate (positive selection) and more educated migrants are more likely to settle in destination countries with high rewards to skill (positive sorting). Using data on emigrant stocks by schooling level and source country in OECD destinations, we find that a simple model of income maximization can account for both phenomena. Results on selection show that migrants for a source-destination pair are more educated relative to non-migrants the larger is the absolute skill-related difference in earnings between the destination country and the source. Results on sorting indicate that the relative stock of more educated migrants in a destination is increasing in the absolute earnings difference between high and low-skilled workers. We use our framework to compare alternative specifications of international migration, estimate the magnitude of migration costs by source-destination pair, and assess the contribution of wage differences to how migrants sort themselves across destination countries.