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Do Rural Migrants Benefit from Labor Market Agglomeration Economies? Evidence from Chinese Cities

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  • Yang, Guangliang
  • Li, Lixing
  • Fu, Shihe
Abstract
We combine the 2005 China Inter-Census Population Survey data and the 2004 China Manufacturing Census to test whether workers, particularly rural migrants, benefit from labor market Marshallian externalities. We find that workers in general, and rural migrants in particular, benefit from labor market pooling effect (measured by total employment in a city-industry cell) and human capital externalities (measured by share of workers with a college degree or above in a city-industry cell). These findings are robust to various sorting bias tests. However, rural migrants benefit much less than do local or urban workers, possibly because rural migrants lack social networks and are discriminated doubly in terms of being both “rural” and “migrants.” Our findings have policy implications on how Chinese cities can become skilled during the rapid urbanization process coupled with global competition.

Suggested Citation

  • Yang, Guangliang & Li, Lixing & Fu, Shihe, 2017. "Do Rural Migrants Benefit from Labor Market Agglomeration Economies? Evidence from Chinese Cities," MPRA Paper 80713, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:80713
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    3. Feiwei Shen & Wenxin Ye & Cong Wang & Xianhong Huang, 2023. "Effects of Organizational Factors on Identification of Young Returnees from Urban Areas with Rural Societies – A Perspective of Adaptability," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 167(1), pages 363-390, June.
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    5. Lili Chen & Jiquan Peng & Yibei Zhang, 2022. "Research on the Impact of Rural Land Transfer on Non-Farm Employment of Farm Households: Evidence from Hubei Province, China," IJERPH, MDPI, vol. 19(23), pages 1-19, November.
    6. Laixun Zhao, 2016. "A Simple Model of the Chinese Hukou System and Some Ongoing Reforms," Discussion Paper Series DP2016-03, Research Institute for Economics & Business Administration, Kobe University, revised Jan 2017.
    7. Yi Liu & Hanyue Wang & Jie Yang & Dingde Xu, 2024. "The Impact of Long-Term Security on the Return of Rural Labor Force: Evidence from Rural China," Agriculture, MDPI, vol. 14(10), pages 1-20, October.

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    More about this item

    Keywords

    Rural migrants; labor market agglomeration economies; Marshallian externalities; labor market pooling; human capital externalities;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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