China’s Mobility Barriers and Employment Allocations

L. Rachel Ngai, Christopher Pissarides and Jin Wang

Journal of the European Economic Association, 2019, vol. 17, issue 5, 1617-1653

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 competitive rental market would correct this inefficiency. The local restrictions on social transfers also act as disincentives to migration with bigger impact on urban migrations than to job moves to rural enterprises.

Date: 2019
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Related works:
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 (2017)
Working Paper: China's mobility barriers and employment allocations (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:oup:jeurec:v:17:y:2019:i:5:p:1617-1653.

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