Relative Concerns of Rural-to-Urban Migrants in China
Institute for the Study of Labor (IZA)
Institute for the Study of Labor (IZA); University College Dublin (UCD)
Klaus F. Zimmermann
Institute for the Study of Labor (IZA); German Institute for Economic Research (DIW Berlin); University of Bonn; Journal of Population Economics; Centre for Economic Policy Research (CEPR)
February 1, 2011
IZA Discussion Paper No. 5480
As their environment changes, migrants constitute an interesting group to study the effect of relative income on subjective well-being. This paper focuses on the huge population of rural-to-urban migrants in China. Using a novel dataset, we find that the well-being of migrants depends on several reference groups: it is negatively affected by the income of other migrants and workers of home regions; in contrast, we identify a positive, 'signal' effect vis-à-vis urban workers: larger urban incomes indicate higher income prospects for the migrants. These effects are particularly strong for migrants who wish to settle permanently, decline with years since migrations and change with other characteristics including work conditions and community ties.
Number of Pages in PDF File: 37
Keywords: China, relative concerns, well-being
JEL Classification: C90, D63working papers series
Date posted: February 21, 2011
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