Rural Industrialisation and Internal Migration in China

Abstract

To avoid the problems of overcrowding and urban unemployment that are associated with overurbanisation observed in other developing countries, China has, since the late 1970s, actively pursued a strategy of rural industrialisation by encouraging the development of rural industries which provide employment opportunities for the surplus labour in agriculture. In this paper, we examine the impact of rural industrialisation on migration using data from the 1990 China Population Census. We use robust estimation of logit models that not only captures the impact of rural industrialisation on migration propensity but also takes into account the nature of clustered data (individuals within provinces). In our estimates, rural industrialisation does not have a statistically significant impact on the probability of either intraprovincial or interprovincial migration. Thus the results cast some doubt about whether China can move on a unique path towards urbanisation.