WTO Accession, Rural Labour Migration and Urban Unemployment in China

Fan Zhai and Zhi Wang ()

Urban Studies, 2002, vol. 39, issue 12, 2199-2217

Abstract: This paper evaluates the rural-urban migration and urban unemployment effects of China's WTO accession based on the China-US bilateral agreement on market accession. The evaluation is conducted by a 53-sector recursive dynamic computable general equilibrium (CGE) model of China benchmarked to a most recent version of the Chinese Social Accounting Matrix (SAM). The simulation results show that there is a great need for co-ordination between China's rural-urban migration policy, labour market reform and the implementation of trade liberalisation measures after China's WTO entry. The net benefit from WTO membership will be maximised if China adopts a policy gradually to relax its rural-urban migration control in conjunction with its labour market reform. Doing so not only prevents a dramatic worsening of the urban unemployment problem, but also permits enough labour market flexibility to create more employment opportunities for rural unskilled labour shifted out of the farming sector.

Date: 2002
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Persistent link: https://EconPapers.repec.org/RePEc:sae:urbstu:v:39:y:2002:i:12:p:2199-2217

DOI: 10.1080/0042098022000033827

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