Migrants and Firms: Evidence from China

85 Pages Posted: 21 Feb 2019

See all articles by Clément Imbert

Clément Imbert

University of Warwick

Marlon Seror

University of Bristol

Yifan Zhang

The Chinese University of Hong Kong (CUHK)

Yanos Zylberberg

University of Bristol

Date Written: 2018

Abstract

This paper estimates the causal effect of rural-urban migration on urban production in China. We use longitudinal data on manufacturing firms between 2001 and 2006 and exploit exogenous variation in rural-urban migration due to agricultural price shocks. Following a migrant inflow, labor costs decline and employment expands. Labor productivity decreases sharply and remains low in the medium run. A quantitative framework suggests that destinations become too labor-abundant and migration mostly benefits low- productivity firms within locations. As migrants select into high-productivity destinations, migration however strongly contributes to the equalization of factor productivity across locations.

Keywords: rural-urban migration, structural transformation, urban production

JEL Classification: D240, J230, J610, O150

Suggested Citation

Imbert, Clément and Seror, Marlon and Zhang, Yifan and Zylberberg, Yanos, Migrants and Firms: Evidence from China (2018). CESifo Working Paper No. 7440, Available at SSRN: https://ssrn.com/abstract=3338794 or http://dx.doi.org/10.2139/ssrn.3338794

Clément Imbert (Contact Author)

University of Warwick

Gibbet Hill Rd.
Coventry, CV4 8UW
United Kingdom

Marlon Seror

University of Bristol ( email )

University of Bristol,
Senate House, Tyndall Avenue
Bristol, BS8 ITH
United Kingdom

Yifan Zhang

The Chinese University of Hong Kong (CUHK) ( email )

Shatin, N.T.
Hong Kong
Hong Kong

Yanos Zylberberg

University of Bristol ( email )

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