Migration and the Quality of Life: Lessons from China

1. Migration and the Quality of Life: Lessons from China Donald J. Treiman University of California at Los Angeles (UCLA) NUSS Lecture 20 January 2011 1

2. Why internal migrationin China is important • There is a lot of it. • About 150 million people—12% of the population—live other than where they are registered. • 56% of the population live in a different place from where they grew up (were living at age 14). • 53% of the urban population came from rural places. • So China is a nation of (internal) immigrants, especially urban China (China is now nearly half urban).

3. Outline • Introduction: brief history of migration in modern (post-1949) China. • Determinants of migration. • Consequences of migration—for migrants, those left behind, and the host society. • Possible lessons for Singapore. 3

4. The hukou system • China built an urban welfare state on the backs of the peasants. • In 1955 established an internal registration (“hukou”) system. • Overarching agricultural vs. non-agricultural (“rural” vs. “urban”) status. • Local vs. non-local status. • Both very difficult to change.

5. Hukou system (2) The “Hukou” system created a 2-class society, with access to welfare benefits differentially available to those with “non-agricultural” and “agricultural” (or “urban” and “rural”) registration: Health, unemployment, and retirement insurance; education; housing; jobs; and, in the days of rationing, food. Also, differential taxation, favoring the urban population: in-kind agricultural tax from 1958 until 2006, but no income tax until 1986. 5 5

6. Hukou system (3) • Many services were and are restricted to those with local registration, or require high non-resident fees (although there are local variations): • Education (Beijing example). • Health care (Hong Kong example). • Until recently, housing and other beneifts were connected to the work unit (danwei). • Important consequences for migration, elaborated in remainder of lecture.

7. Migration trends • Severe restrictions on voluntary migration from 1961-1978 (end of Great Leap Forward to beginning of Economic Reform) [hotel room example]. • Some sponsored/coerced migration, but numerically not very large: • 1950s, to peripheral areas, to ensure Han domination. • 1964 and after, relocation of industry to interior. • Late 1960s-early 1970s: Cultural Revolution “sent down” youth (most returned). • Late 1990s to present: Three Gorge Dam resettlement. 7

8. Migration trends 2 • Increasing migration since 1978, due to • Relaxation of restrictions on migration, accompanying economic reform. • Push: “family responsibility system,” resulting in agricultural labor surplus. • Pull: economic expansion in urban and peri-urban areas, especially expansion of export-oriented manufacturing, resulting in need for low-level labor (factory, construction, service, and sales).

9. Migration is complex • People may move many times; and often any move is for a combination of reasons. • People may move with or without their families. • Moves may be intended as “temporary” or “permanent”. • In China, a move may or (more usually) may not entail a hukou change.

10. Two-class migration system • For some, migration is accompanied by a hukou change from rural to urban status, mainly possible for those who obtain tertiary or technical secondary education. • The majority, however, retain their rural hukou. • The analogy to Singapore’s “talent” and “temporary worker” patterns of immigration should be evident.

13. Focus of tonight’s presentation • My focus tonight is on out-migration for work by those with rural hukou. • Will ignore urban-to-urban, urban-to-rural, and rural-to-urban migration accompanied by hukou change. • Data: from a nation-wide sample survey of Chinese adults carried out in 2008, with an over-sample of high out-migration and high in-migration areas.

14. Who goes out for work? • What increases the odds that peasants go out for work (discrete-time hazard rate models for people 14-58 with rural hukou at age 14); • Expectations: • As elsewhere, migrants are disproportionately male and young. • “Healthy migrant hypothesis”—migrants are positively selected for health. • Generalization: migrants are positively selected for “quality.”

15. 15

17. Changing migration pattern • In 1990’s, migrants tended to go out if they couldn’t make it doing agriculture, sent remittances to their families. • In recent years, migrants go out immediately from secondary school, have no experience in agriculture. Thus, many migrants are very young.

18. Young worker in Dongguan, Guandong, factory, November 2010.

19. Summary: likelihood of going out • (Note: given that this is not a technical lecture, I am not showing the statistical evidence; but if you want to see it, ask during the Q and A.) • Personal factors • Concentrated in young males. • Increased by health (excellent eyesight, animal protein as child). • Increased by parental educ. and R’s education.

20. Summary 2 • Social factors • Increased if father in agriculture (lack of job opportunities at home). • Reduced by employment (many go out straight from school). • Increased by self employment. • Increased by isolation of village. • Overall: Chinese peasant labor migration tends to be a response of the best and the brightest of those living in disadvantaged circumstances. Worldwide pattern.

21. How do migrant workers fare? • What are the consequences of migration? (contrasting current rural migrants with rural-hukou holders who have never migrated, adjusting for superior “quality” of migrants using propensity scores [elaborate this]). • Expectations: Migration has • a positive effect on income. • a negative effect on working conditions. • a negative effect on quality of life. • a negative effect on emotional health. • A positive effect o health.

22. Factory dormitory, Shenzhen, Guangdong, November 2010.

23. Migrant construction workers at their sleeping place, Beijing, June 2007.

24. Summary: migration outcomes • Results are generally as expected. Relative to those left behind, • Migration increases income (more than doubles it). • Migrants have harsher working conditions than rural non-migrants (a striking result given rural hardship). • Migrants feel disrespected. • Migrants more likely to be robbed. • Migrants eat better (more frequent animal protein). • Migrants practice better hygiene (more frequent showers, teeth brushing; more likely to drink tap or bottled water).

25. Summary (2) • Compared to those left behind, migrants are healthier: • less heavy. • have lower blood pressure. • better lung capacity. • lower glycosylated hemoglobin (a measure of chronic inflammation) • less likely to have been advised to see a doctor, but have seen a doctor more frequently, even though much less likely to have health insurance. • Report themselves as healthier.

26. Another take on outcomes • What are the consequences of migration for occupational status, level of living? (Over-time fixed-effects analysis for those with rural hukouwho had never migrated as of 5 years earlier.) • Contrasts: never out; former (out and back in past 5 years); currently out. • Expectations: • Current migrants will have higher occupational status (ISEI) and be less likely to work in agriculture than never migrants. The more interesting question—what about former migrants? • Former migrants will have more consumer durables than never migrants, but current migrants will not, due to restricted living conditions.

27. Summary • Results are generally as expected. • Current migrants are less likely to work in agriculture and tend to work at slightly high status jobs. • More interestingly, returned migrants gain no advantage in terms of avoiding agriculture or upgrading their agricultural status relative to those who have never migrated. • But migration pays off in terms of an increased level of living, as measured by the number of consumer durables possessed by returned migrants.

28. Consequences for those left behind (From a separate analysis) • Rural people with family members out for work are more likely to be depressed. • Remittances partly offset the negative consequences of family members being away.

29. Conclusions • Internal migration in China follows the pattern of labor migration elsewhere: • Migration is selective of the young, especially young men, of the healthy, and of those who are relatively advantaged compared to their neighbors. • Even controlling for selectivity, migration appears to be economically advantageous, yielding much higher income than for those left behind, a higher level of living for returned migrants, and better health for current migrants. • But migration is also costly, resulting in difficult working and living conditions and psychological stress.

30. Implications for Singapore • I understand that the major issue for Singapore today is whether to encourage or to discourage immigration. • Of course, Singapore is hardly like China. Actually, a better analogy might be the experience of Hong Kong. However, I know little about research on migration in Hong Kong. • Still, I can offer a few observations that might be helpful as you grapple with this issue.

31. The arguments for increasing immigration • Singapore has a very low birth rate and an aging population (new report shows new record low: 1.16, whereas 2.1 is necessary to sustain population at a fixed level). Thus, there are too few working age people supporting an increasing elderly population. • In particular, there are too few people available to do low-level work (construction, domestic service, etc.)

32. The arguments for limiting immigration • Immigration takes jobs away from locals. • “Talented” immigrants are given unfair special privileges. • Immigration undercuts Singapore’s distinctive identify.

33. Lessons from China (and elsewhere) • China’s sustained economic growth (an average of 10% per annum increase in GDP for 30 years) would not have been possible without a labor supply for the export-oriented industrial sector. • It is likely that Singapore’s economic growth also depends on increased immigration, both high and low level, especially given the aging population.

34. Make immigration possiblefor temporary workers • Relying on the “talent” pool to provide more workers and, crucially, to change the age distribution, probably will not be effective. • An obvious solution is to make permanent residency and eventual citizenship available to temporary workers. They are young, positively selected for personal qualities, and are likely to add to the vibrancy of the economy, as well as increasing fertility and changing the age structure.

35. Are the arguments against immigration valid? Probably not. • It is notoriously difficult to demonstrate that immigrants steal jobs—which is why U.S. and other studies tend to get mixed results. • It is likely that immigrants stimulate the economy, which benefits everybody. • The “distinctive Singapore identity” argument is also dubious. Singapore is already a highly diverse place, and a nation of immigrants, which is what makes it so dynamic. Why stifle the dynamism by preserving the current ethnic mix?

36. The fairness issue • Simple decency—the mark of a civilized society—would seem to dictate treating temporary workers better and relaxing the current draconian regulations that forbid families to accompany migrants; require that pregnant women be deported, etc.

37. Fairness (2) • As we have seen, migrants in China (and elsewhere) are positively selected, but live difficult lives. Moreover, their families suffer from their absence. This probably is just as true of Singapore. Better integration of temporary workers, with the possibility of eventually qualifying for citizenship, would have positive benefits for Singapore.

38. What needs to be done • Policy debates need to be based on empirical evidence, available to all participants. • Singapore is under-studied by social scientists. • Need comparative analysis of Singapore with other places, e.g., Hong Kong. • To study Singapore, need data. • The Statistical Office should release census and sample survey data for public use, as is done in most advanced nations. • Singapore social scientists should launch their own sample surveys.

39. Determinants of migration: evidence

46. Consequences of migration:evidenc(propensity score analysis)

47. Propensity score model • Adjusts for differences between those who never have gone out, those currently out in • prevalence of illnesses, gender, and their interaction; years of schooling; age, age-squared, and their interaction with schooling; and size of place of residence prior to going out (dummies). • Nearest neighbor matching with a caliper of .01 and common support. • Reasonably well balanced: • Mean bias is 5.11% after matching. • 12 of 16 variables have < 5% bias, 3 have < 10% bias, and 1 has > 10% bias.