China’s mobility barriers and employment allocations

L. Rachel Ngai, Christopher Pissarides and Jin Wang ()
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Jin Wang: Division of Social Science, The Hong Kong University of Science and Technology

No 2017-44, HKUST IEMS Working Paper Series from HKUST Institute for Emerging Market Studies

Abstract: China’s hukou system imposes two main barriers to population movements. Agricultural workers get land to cultivate but are unable to trade it in a frictionless market. Social transfers (education, health, etc.) are conditional on holding a local hukou. We show that the land policy leads to over-employment in agriculture and it is the more important barrier to industrialization. Effective land tenure guarantees and a perfect competitive rental market would correct this inefficiency. The local restrictions on social transfers favour rural enterprises over urban employment with a relatively smaller impact on industrialization.

Pages: 44 pages
Date: 2017-08, Revised 2017-12
New Economics Papers: this item is included in nep-agr, nep-cna, nep-lab, nep-tra and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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https://iems.ust.hk/assets/publications/working-pa ... emswp2017-44_new.pdf Second version, 2017 (application/pdf)

Related works:
Journal Article: China’s Mobility Barriers and Employment Allocations (2019)
Working Paper: China’s mobility barriers and employment allocations (2019)
Working Paper: China’s Mobility Barriers and Employment Allocations (2018)
Working Paper: China's mobility barriers and employment allocations (2018)
Working Paper: China's mobility barriers and employment allocations (2016)
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