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City size, migration and urban inequality in China

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  • Chen, Binkai
  • Liu, Dan
  • Lu, Ming

Abstract

This paper examines the relationship between city size, migration, and urban income inequality using a subsample of the 1% population census of China in 2005. We calculate various measures of within-city income inequality for 252 Chinese cities. It is found that overall city income inequality is significantly and positively correlated with population size. As migration is crucial in determining city size distribution in China, we focus on exploring the role of massive migration into big cities in shaping this size-inequality relationship. We find that the share of migrants alone accounts for more than 40% of the city size inequality premium. This is primarily because migration leads to higher skill premiums in larger cities by changing the skill composition of workers in those places.

Suggested Citation

  • Chen, Binkai & Liu, Dan & Lu, Ming, 2018. "City size, migration and urban inequality in China," China Economic Review, Elsevier, vol. 51(C), pages 42-58.
    • Handle: RePEc:eee:chieco:v:51:y:2018:i:c:p:42-58
    DOI: 10.1016/j.chieco.2018.05.001
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    More about this item

    Keywords

    City size; Income inequality; Migration; Skill premium; China;
    All these keywords.

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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