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Social insurance, demographics, and rural-urban migration in China

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  • Bairoliya, Neha
  • Miller, Ray

Abstract

We develop a dynamic general equilibrium model to analyze the impact of social insurance policy and demographic changes on rural-urban migration in China. Quantitative analyses indicate that different social insurance programs not only have differential effects on net migration flows but also on the age and income distribution of migrants. Enrolling migrants in urban pensions discourages rural-urban migration at young ages and reverse migration in old-age. In contrast, urban health insurance incentivizes rural-urban migration among low income groups at all ages while simultaneously disincentivizing reverse migration. These differences subsequently have important impacts on overall migration patterns and the macroeconomy. Incorporating population aging in the model also yields an increase in the working age migrant share as higher capital accumulation maintains significant upward pressure on urban wages. Overall, results indicate that general equilibrium effects matter and demographic and policy changes alter migration incentives differently at different stages of the life-cycle.

Suggested Citation

  • Bairoliya, Neha & Miller, Ray, 2021. "Social insurance, demographics, and rural-urban migration in China," Regional Science and Urban Economics, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:regeco:v:91:y:2021:i:c:s0166046220303008
    DOI: 10.1016/j.regsciurbeco.2020.103615
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    2. Ruan, Peiheng & Wang, Shuai & Yun, Feng, 2024. "Social insurance law and corporate performance in China," International Review of Economics & Finance, Elsevier, vol. 94(C).
    3. Fang, Jing & Fu, Fanjie & Zhang, Xiaoqian & Yao, Shujie & Ou, Jinghua, 2024. "Impact of high-speed rail on the mismatch of labor and industry allocations: Evidence from Chinese cities in 2000-2019," Journal of Asian Economics, Elsevier, vol. 92(C).
    4. Hong Chen & Jia Yu & Mingshuai Qin & Yangyang Wang & Lijian Qin, 2023. "Unlocking Opportunities for Migrant Workers in China: Analyzing the Impact of Health Insurance on Hukou Switching Intentions," Sustainability, MDPI, vol. 15(8), pages 1-15, April.
    5. Qingsheng Bi & Weiqiang Chen & Ling Li & Xiuli Wang & Enxiang Cai, 2022. "Agricultural Population Supported in Rural Areas under Traditional Planting Mode Based on Opportunity Cost Analysis," Land, MDPI, vol. 11(8), pages 1-15, August.
    6. Huaxin Wang-Lu & Octasiano Miguel Valerio Mendoza, 2022. "Job Prospects and Labour Mobility in China," Papers 2207.08282, arXiv.org, revised Sep 2022.
    7. Li, Jingrong & Mi, Xinyu & Zhang, Chenlei & Qin, Yanran, 2024. "Social pension insurance and household risky asset investment: Evidence from China," The Quarterly Review of Economics and Finance, Elsevier, vol. 95(C), pages 219-233.

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    More about this item

    Keywords

    China; Internal migration; Health; Aging; Healthcare; Pension;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private

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