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Low-Skilled Immigrants and Urban Development? in China: A Labor Market Perspective

Author

Listed:
  • Chao Liang

    (Center for Economic Research Shandong University No. 27 Shanda South Road Jinan 250100, China)

  • Susu Wang

    (Shanghai Customs College No. 5677 Huaxia West Road Shanghai 201204, China)

Abstract

This study investigates the impact of low-skilled immigrants on urban labor markets in China. Using historical migration networks as an instrumental variable to overcome endogeneity problems, we find that low-skilled immigrants significantly increase local wages. Census data reveal significant occupational segregation between low-skilled immigrants and local inhabitants. Low-skilled immigrants are found to substitute for low-skilled local inhabitants but are complementary for high-skilled local inhabitants. In addition, low-skilled immigrants boost women's labor participation and wages through consumption service markets. This study's findings reveal that discrimination against low-skilled immigrants weakens the reciprocal effects among immigrants and local inhabitants and hinders urban development.

Suggested Citation

  • Chao Liang & Susu Wang, 2020. "Low-Skilled Immigrants and Urban Development? in China: A Labor Market Perspective," Asian Economic Papers, MIT Press, vol. 19(1), pages 114-128, Winter/Sp.
    • Handle: RePEc:tpr:asiaec:v:19:y:2020:i:1:p:114-128
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