This paper traces the period when the protection of rural immigrants’ rights and interests is relatively rare. Based on the CHIPS2007 data, this paper investigates whether rural immigrants could be assimilated into the urban labor market through extending the migration time and accumulating the non-agricultural work experience which is compatible with the destination. The results show that although the returns on the non-agricultural work experience of rural immigrants are higher than those of urban workers in the short-term, the relative returns on the experience will gradually decline in the long-term. As a result, rural immigrants could not be assimilated into the urban labor market during their life cycle. We should note that there is a sample self-selection problem in our empirical research, that is, some rural immigrants may choose to return to their hometowns, and their decisions are the results of their self-selection, which are related to the observable individual characteristics and the unobservable individual abilities. If we ignore the rural immigrants who may choose to return to hometowns, the estimation of the impact of migration time on the wage gap between rural immigrants and urban workers will suffer from a large deviation. Based on this judgment, we employ the Heckman’s two-steps model to correct the selection bias. After correcting the selection bias, we find that the hourly wage of rural immigrants is about 30.53% lower than that of urban workers at the beginning of migration, and the sustained migration could eliminate up to 9.4% of the wage gap. Although the assimilation rate between rural immigrants and urban workers has increased, rural immigrants still cannot be assimilated into the urban labor market through extending the migration time. In order to deeply investigate the reasons why rural immigrants cannot be assimilated by extending their migration time, we firstly use an occupational transfer matrix to analyze the occupational distribution of rural immigrants and whether there are rises in their occupational ladder. Our results show that the occupational distribution of rural immigrants is relatively fixed and there is a lack of rise in their occupational ladder. Furthermore, we employ the improved Brown Decomposition method to investigate the wage gap between rural immigrants and urban workers from three dimensions: " between occupation effect”, " within occupation effect”, and " assimilation effect”. We find that " assimilation effect” brought by the extension of the migration time can reduce the wage gap to a certain extent, but it could not fundamentally eliminate the wage gap caused by both the household register discrimination within the occupation and the lack of human capital which makes them not have the abilities to climb the occupational ladder.
Could Rural Immigrants Be Assimilated into the Urban Labor Market？
Journal of Finance and Economics Vol. 45, Issue 02, pp. 86 - 99 (2019) DOI:10.16538/j.cnki.jfe.2019.02.007
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Cite this article
Lv Wei, Yang Mo, Zhu Dongming. Could Rural Immigrants Be Assimilated into the Urban Labor Market？[J]. Journal of Finance and Economics, 2019, 45(2): 86-99.