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Migration, Remittances, and Agricultural Productivity in China

Migration, Remittances, and Agricultural Productivity in China. ------ ECN 5471 Assignment II. Migration, Remittances, and Agricultural Productivity in China. Authors: Rozelie, Scott; Taylor, J. Edward; Debrauw, Alan Source: American Economic Review, May 99. Content.

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Migration, Remittances, and Agricultural Productivity in China

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  1. Migration, Remittances, and Agricultural Productivity in China ------ ECN 5471 Assignment II

  2. Migration, Remittances, and Agricultural Productivity in China • Authors: Rozelie, Scott; Taylor, J. Edward; Debrauw, Alan • Source: American Economic Review, May 99

  3. Content • Productivity Effects and the New Economics of Labor Migration • Methods • Data • Findings • Conclusions What factors trigger migration and motivate migrants to remit a portion of their incomes? How does large-scale migration affect agricultural productivity? Do remittances from migrants intensify or compensate for the labor leaving villages? 70% China's labor force is in the agricultural sector 10% increase per capita GNP 3.1 % decrease workforce employed in agriculture

  4. Productivity Effects and the New Economics of Labor Migration New economics of labor migration: the complexity of migration as an economic institution the interrelationship between migration's determinants and impacts, and migrants Stark: migrants play the role of financial intermediaries, enabling rural households to overcome credit and risk constraints on their ability to achieve the transition from familial to commercial production. Q* = fi(T, Zy). household characteristics c(T1) </= K, c'(T1) > 0

  5. Methods • YC = γo + γ1M + γ2R + γ3ZY + εY • γ1, γ2 = 0 • R = αo + α1M + γ3ZR + εR • M = βo + β1 ZM + εM.

  6. FindingsMigration Effects:

  7. Findings • migration generates statistically significant lost-labor effects that depress yields • the negative effect from less family labor is in part compensated by access to capital through increased remittances An additional yuan remitted increases yield by 0.44 jin per mu Remittances are a positive function of migration increased remittances only partially offset the migration effect a one-person increase in migration is associated with an 819-yuan increase in remittance income

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