This paper traces the period when the protection of rural immigrants’ rights and interests is relatively rare. Based on the CHIPS2007 data, this paper investigates whether rural immigrants could be assimilated into the urban labor market through extending the migration time and accumulating the non-agricultural work experience which is compatible with the destination. The results show that although the returns on the non-agricultural work experience of rural immigrants are higher than those of urban workers in the short-term, the relative returns on the experience will gradually decline in the long-term. As a result, rural immigrants could not be assimilated into the urban labor market during their life cycle. We should note that there is a sample self-selection problem in our empirical research, that is, some rural immigrants may choose to return to their hometowns, and their decisions are the results of their self-selection, which are related to the observable individual characteristics and the unobservable individual abilities. If we ignore the rural immigrants who may choose to return to hometowns, the estimation of the impact of migration time on the wage gap between rural immigrants and urban workers will suffer from a large deviation. Based on this judgment, we employ the Heckman’s two-steps model to correct the selection bias. After correcting the selection bias, we find that the hourly wage of rural immigrants is about 30.53% lower than that of urban workers at the beginning of migration, and the sustained migration could eliminate up to 9.4% of the wage gap. Although the assimilation rate between rural immigrants and urban workers has increased, rural immigrants still cannot be assimilated into the urban labor market through extending the migration time. In order to deeply investigate the reasons why rural immigrants cannot be assimilated by extending their migration time, we firstly use an occupational transfer matrix to analyze the occupational distribution of rural immigrants and whether there are rises in their occupational ladder. Our results show that the occupational distribution of rural immigrants is relatively fixed and there is a lack of rise in their occupational ladder. Furthermore, we employ the improved Brown Decomposition method to investigate the wage gap between rural immigrants and urban workers from three dimensions: " between occupation effect”, " within occupation effect”, and " assimilation effect”. We find that " assimilation effect” brought by the extension of the migration time can reduce the wage gap to a certain extent, but it could not fundamentally eliminate the wage gap caused by both the household register discrimination within the occupation and the lack of human capital which makes them not have the abilities to climb the occupational ladder.
/ Journals / Journal of Finance and Economics
Journal of Finance and Economics
LiuYuanchun, Editor-in-Chief
ZhengChunrong, Vice Executive Editor-in-Chief
YaoLan BaoXiaohua HuangJun, Vice Editor-in-Chief
Could Rural Immigrants Be Assimilated into the Urban Labor Market?
Journal of Finance and Economics Vol. 45, Issue 02, pp. 86 - 99 (2019) DOI:10.16538/j.cnki.jfe.2019.02.007
Summary
References
Summary
[1] Chen X, Xu S. The Economic Disadvantage and Assimilation of Rural Migrants in China[J]. Economic Research Journal, 2014, 49(10): 74-88. (In Chinese)
[2] Deng Q H. Earnings Differential between Urban Residents and Rural Migrants: Evidence from Oaxaca-Blinder and Quantile Regression Decompositions[J]. Chinese Journal of Population Science, 2007(02): 8-16+95. (In Chinese)
[3] Li H Y, Shao M. The Effect of Temporary Employment on Labor Wages[J]. Journal of Finance and Economics, 2018, 44(01): 113-127. (In Chinese)
[4] Lv W, Yang M, Wang Y. The Urban - Rural Income Gap and Education Inequality and Government Spending on Education in China[J]. Comparative Economic & Social Systems, 2015(03): 20-33. (In Chinese)
[5] Lv W, Yang M. The Migration Time will Help the Rural-Urban Immigrants be Assimilated in the Urban Labor Market? From the Dynamic Perspectives of Occupational Mobility and Wage Convergence[J]. Research on Financial and Economic Issues, 2016(10): 101-109. (In Chinese)
[6] Sun J F. Changes to Hukou Discrimination in China’s Labor Market: Employment and Wages of Rural Migrant Workers[J]. Economic Research Journal, 2017, 52(08): 171-186. (In Chinese)
[7] Wan H Y, Li S. The Effects of Household Registration System Discrimination on Urban-rural Income Inequality in China[J]. Economic Research Journal, 2013, 48(09): 43-55. (In Chinese)
[8] Wu J, Yao X G, Zhang J S. Is Hukou Discrimination between Urban and Rural Areas Vanishing:1989-201[J]. Economic Research Journal, 2015, 50(11): 148-160. (In Chinese)
[9] Xie G H. Returns to Human Capital and Social Integration of Migrants in China[J]. Social Sciences in China, 2012(04): 103-124+207. (In Chinese)
[10] Yang P, Liu J, Chang W. The Impacts of Distortion and Relaxation of the Hukou System on Chinese Economy: Theory and Evidence[J]. Journal of Finance and Economics, 2018, 44(02): 44-57. (In Chinese)
[11] Yu X H, Chen X J. Empirical Research on the Effect of the Household Registration System Evolvement on Labor Market Segmentation in China: From Dual Perspectives of Employment Opportunities and Wage Gap[J]. Economic Research Journal, 2012, 47(12): 97-110. (In Chinese)
[12] Zhao H T. The Wage Gap between the Migrants and Urban Residents. From the Pespective of Occupational Segregation[J], World Economic Papers, 2015(02): 91-108. (In Chinese)
[13] Abramitzky R, Boustan L P, Eriksson, K. A Nation of Immigrants: Assimilation and Economic Outcomes in the Age of Mass Migration[J]. Journal of Political Economy, 2014, 122(3), 467-717.
[14] Antecol H, Kuhn P, Trejo S J. Assimilation via Prices or Quantities? Sources of Immigrant Earnings Growth in Australia, Canada, and the United States[J]. Journal of human Resources, 2006, 41(4), 821-840.
[15] Borjas G J. Assimilation, Changes in Cohort quality, and the Earnings of Immigrants[J]. Journal of Labor Economics, 1985, 3(4), 463-489.
[16] Borjas G J. Immigrant and Emigrant earnings: A longitudinal Study[J]. Economic inquiry, 1989, 27(1), 21-37.
[17] Borjas G J, Friedberg R M. Recent Trends in the Earnings of New Immigrants to the United States, 2009, NBER Working Papers.
[18] Borjas G J. Immigration economics[M]. Harvard University Press, 2014.
[19] Chiswick B R. The Earnings of White and Colored Male Immigrants in Britain[J]. Economica, 1980, 47(185), 81-87.
[20] Chiswick B R. Are Immigrants Favorably Self-selected?[J]. American Economic Review, 1999, 89(2), 181-185.
[21] Chiswick B R, Lee Y L, Miller P W. A Longitudinal Analysis of Immigrant Occupational Mobility: A Test of the Immigrant Assimilation Hypothesis1[J]. International Migration Review, 2005, 39(2), 332-353.
[22] Friedberg R M. You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital[J]. Journal of Labor Economics, 2000, 18(2), 221-51.
[23] Heckman J J. Sample selection bias as a specification error (with an application to the estimation of labor supply functions)[J]. 1977.
[24] Hu W Y. Immigrant Earnings Assimilation: Estimates from Longitudinal Data[J]. American Economic Review, 2000, 90(2), 368-372.
[25] Ibarraran P, Lubotsky D. Mexican Immigration and Self-selection: New Evidence from the 2000 Mexican Census[M]. University of Chicago Press, 2007, 159-192.
[26] Lubotsky D. Chutes or Ladders? A longitudinal Analysis of Immigrant Earnings[J]. Journal of Political Economy, 2007, 115(5), 820-867.
[27] Rosenbaum P R, Rubin D B. Comment: Estimating the Effects Caused by Treatments[J]. Journal of the American Statistical Association, 1984, 79(385), 26-28.
[28] Zhang D D, Meng X, Wang D W. The dynamic change in wage gap between urban residents and rural migrants in Chinese cities[J]. PMMA Working Paper, 2010.
Cite this article
Lv Wei, Yang Mo, Zhu Dongming. Could Rural Immigrants Be Assimilated into the Urban Labor Market?[J]. Journal of Finance and Economics, 2019, 45(2): 86-99.
Export Citations as:
For
ISSUE COVER
RELATED ARTICLES