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Urban Migration

Migration to cities can equalize household income in rural China

Xubei Luo's picture

With Nong Zhu

Migrant workers have been contributing to one-sixth of China’s GDP growth since the mid 1980s. The impact of rural migrants’ contribution is best seen in cities during the Chinese New Year, when they return to reunite with their families, leaving behind a massive urban labor shortage. This happens every year despite urban families and restaurant owners offering high bonuses.

There is a consensus that migration has contributed to increased rural income, but views differ on its impact on rural inequality. My view is that rural households with higher incomes are not more likely than poorer households to participate in migration or benefit disproportionately from it. Adding to my recent blog in People Move, I would like to discuss the reasons behind this.

Impacts of migration on rural poverty and inequality in China

Xubei Luo's picture

with Nong Zhu.

In China, rural-to-urban migration and development of the rural non-farm sector strongly modified rural household income structure since the economic reform. In the mid 2000s, almost half of total rural income in China was from non-farm activities. Whether the decline in poverty was principally due to farm income growth or due to non-farm income growth and whether the rising share of non-farm income in total rural household income was the leading cause of the sharp increase in rural inequality have been key issues of debate.