The new rural-urban labor mobility in China: Causes and implications |
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| Institution: | 1. Department of Economics, Illinois Wesleyan University, Bloomington, IL 61702-2900, USA;2. Department of Business Administration, Illinois Wesleyan University, Bloomington, IL 61702-2900, USA;3. KPMG, Inc., 345 Park Avenue, New York, NY 10154, USA;1. Sichuan Center for Rural Development Research, College of Management of Sichuan Agricultural University, Chengdu, 611130, China;2. College of Economics of Sichuan Agricultural University, Chengdu, 611130, China;3. China Western Economic Research Center, Southwestern University of Finance and Economics, Chengdu, 610074, China;4. Institute of Mountain Hazards and Environment, Chinese Academy of Sciences, Chengdu, 610041, China;1. Beijing Normal University, Beijing, China;2. Shanghai Finance Institute, Shanghai, China;3. School of Economics, Chongqing Technology and Business University, China;4. Asian Development Bank, Philippines;5. National School of Development, Peking University, Beijing, China;1. School of Planning, University of Waterloo, Waterloo, ON N2L 3G1, Canada;2. College of Economics and Management, Northwest Agriculture and Forestry University, Yangling, Shaanxi Province, 712100, China |
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| Abstract: | As the Chinese economy reforms, a huge new floating population of rural-urban migrants is transforming the urban labor force. This article explores some of the most important reasons for the emergence of the floating population in China. We argue that the neoclassical model alone is not adequate to explain the massive rural-urban internal migration underway in China. Instead, ideas drawn from both sociological theories of segmented markets and institutional economics are used to supplement the standard neoclassical explanation. We found that Chinese policy reforms in both rural and urban areas decreased the balkanization of labor markets and opened up employment opportunities for many rural-urban migrants. In rural areas, a set of agricultural market reforms, starting in 1978, increased farm incomes and simultaneously produced a large surplus labor supply. In urban areas, reforms beginning in the 1980s created an effective demand for rural migrants. Of particular importance was the development of a contract labor system and the emergence of a private sector. |
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