Leaving the Countryside: Rural-To-Urban Migration Decisions in China

• Published in: The American economic review Vol. 89; no. 2; pp. 281 - 286
• Main Author: Zhao, Yaohui
• Format: Journal Article
• Language: English
• Published: Menasha, Wis American Economic Association 01.05.1999
• Subjects: Agricultural land; Agriculture; China; Comparative studies; Economic models; Economic theory; Farming; Farms; Farmworkers; History's Largest Labor Flow: Understanding China's Rural Migration; Households; Hypotheses; Internal migration; Labor force; Labor migration; Labor supply; Labour mobility; Manual workers; Migrant workers; Migration; Population movements; Preschool children; Property taxes; Regression analysis; Rural areas; Rural urban migration; Statistical significance; Taxation; Urban areas; Urbanization; Wage rates; Workforce; China
• ISSN: 0002-8282; 1944-7981
• DOI: 10.1257/aer.89.2.281

This study has explored the migration decisions of households in rural China using a household survey in Sichuan province. It answers two questions. First, what determines the migration decision? Second, is migration a temporary or a permanent choice for the household? Empirical results are consistent with the hypothesis that rural households make labor-allocation choices based on comparing marginal returns to labor in farming and alternative employment. Major findings are as follows. First, the shortage of farmland and the abundance of household labor are among the most important determinants of labor migration because they reduce the relative marginal income from labor in farming. Second, rural taxation has a statistically significant effect on the migration decision because it reduces the amount of income derived from agricultural production by the last farm laborer. Finally, rural households view impact migration as transit income, since it has very small impact on rural consumption.