Migrants and Firms: Evidence from China (R&R, American Economic Review)

Clement Imbert, Marlon Seror, Yifan Zhang, Yanos Zylberberg

Research output: Working paperWorking paper and Preprints

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.
Original languageEnglish
PublisherCESifo
Publication statusPublished - 2018

Publication series

NameCESifo Working Paper
PublisherCESifo

Keywords

  • rural-urban migration
  • structural transformation
  • urban production

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