Economic incentives and settlement intentions of rural migrants: Evidence from China

Abstract

Based on a large, nationwide, household-level survey data set collected in 2014, this article investigates the effect of economic incentives on the destination choices of Chinese new-generation rural migrants. Empirical results show that economic incentives have a significant positive impact on the probability of rural migrants' urban settlement intentions but with a diminishing marginal effect. We also find that the marginal effect of economic incentives on rural migrants' urban settlement decreases with the distance to their hometown. Furthermore, the variations of the impacts of economic incentives on rural migrants' settlement intentions are investigated with respect to education level, employment status, and regional heterogeneity. Finally, we discuss policy implications resulting from our empirical analysis. Over the last 2 decades, China has experienced massive rural-to-urban migration, the largest population flow in human history (United Nations, 2015). By the end of 2016, the number of Chinese rural migrants reached 281.7 million. However, constrained by the household registration system (hukou) and other institutional barriers, an astonishing number of migrants are marginalized in Chinese urban society through not being able to gain access to basic local public services and social security (Démurger, Gurgand, Li, & Yue, 2009; He & Wang, 2016). According to official statistics, by the end of 2013, approximately 53.7% of Chinese lived in urban areas but only 36% of Chinese had urban hukou (The State Council of the PRC, 2014). Encouragingly, since 2014, the Chinese government has launched the so-called people-oriented new-type urbanization campaign, which aims to promote better integration of rural migrants into the local urban society (The State Council of the PRC, 2014). The question of how to make rural migrants permanently settle down in the cities has been given increasing priority in the Chinese central government's political agenda. Nonetheless, although there is a large body of literature exploring the factors that affect migration decisions of Chinese rural farmers in China (

City economic development, housing availability, and migrants' settlement intentions: Evidence from China

“…Notably, the above conclusions are generally based on different kinds of survey data, and the definitions of "settlement intention" vary across studies. For instance, some scholars captured migrants' settlement intention through the question, "Do you want to live in the host city for more than 5 years" (Chen & Wang, 2019;Liu et al, 2018;Xie & Chen, 2018), while other research was based on the question, "Do you want to permanently settle in the host city" (Liu et al, 2017;Tao, 2017;Xing & Zhang, 2017). However, in the context of the weakened effect of the hukou system and the growing importance of homeownership, these two questions may produce different responses.…”

Factors Influencing the Settlement Intentions of Chinese Migrants in Cities: An Analysis of Air Quality and Higher Income Opportunity as Predictors

“…Recent research on migrants’ location choices regarding settlement intentions in urban areas has investigated the demographic characteristics of migrants (such as age, marital status, educational level), family factors (such as family size), economic factors (such as income level), and social factors (such as the characteristics of employment and social security) [ 19 , 20 , 21 , 22 , 23 ]. In addition to the above factors, air pollution has become one of the most significant health risks faced by urban residents around the world and, to a certain degree, influences the settlement intentions of migrants.…”

Rural land reforms and villagers' preferences for urban settlement: A case study of Shandong Province, China

“…The study by Chen and Wang (2019), for example, suggested that compared to highly educated rural migrants, rural migrants with less education were more sensitive to economic incentives-defined as the individual-specific income ratio between the host city and the hometown of migrant-when making decisions about permanent settlement in the host cities. A possible explanation is that rural migrants with less education tend to focus on short-run economic returns when they make settlement decisions, whereas migrants with higher educational attainment often have other considerations such as career opportunities and urban amenity features of the city (Chen & Wang, 2019;Zhu & Chen, 2010). Similar to education, income level of rural migrants has been found to be positively related to their preference for urban settlement.…”