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Expropriation with Hukou Change: Evidence from a Quasi-Natural Experiment

Mehtap Akgüc (), Xingfei Liu and Max Tani
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Mehtap Akgüc: Center for European Policy Studies (CEPS)

No 8689, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We study the labor market outcomes of males aged 18-60 obtaining an urban hukou as a result of land expropriation across a number of provinces in China. Using 2008 and 2009 RUMiC data pooling urban, rural and migrant samples, we find that those obtaining an urban hukou have better labour market outcomes than rural stayers and migrants, and close the gap vis-à-vis native urbanites. We also find that children of families experiencing a hukou change due to expropriation have similar investment in human capital as the children of native urban hukou holders. The results confirm the hukou status as a strong economic determinant of labor market outcomes and as a source of inequality. Differences in educational investment, regardless of the differences in parental background, appear however to disappear for the children of families experiencing expropriation, suggesting that leveling the hukou status amongst children in an urban area may be a first step towards reducing intergenerational inequality.

Keywords: expropriation; China; labour markets; economic reform; quasi-experiment (search for similar items in EconPapers)
JEL-codes: D19 H13 J18 O12 O43 R20 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cna, nep-lma and nep-tra
Date: 2014-12
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