This study examines differences in the composition of consumption between rural-urban migrants and urban residents in China, using household level data for the years 2007 and 2018. It sheds light on the main factors driving these differences and their evolution over time. To distinguish the role of income from other determinants of consumption, the analysis estimates the impact of migration on spending in agriculture, manufacturing, and services—both unconditionally and conditionally on total expenditure. While unconditional estimates capture the overall effect of migration, conditional estimates isolate the influence of institutional constraints and preference heterogeneity. The study further exploits variation in Hukou-related restrictions—across regions, policy types, and city sizes—to assess the relative contributions of regulatory barriers and migrants’ preferences. The findings show that migrants display a distinct consumption structure, particularly with a lower share allocated to services. In 2007, both lower income levels and institutional constraints contributed to these differences between migrants and residents. By 2018, a convergence in consumption patterns is observed, largely driven by rising migrant incomes and the loosening of institutional constraints. However, full convergence has not yet been achieved, with remaining differences largely attributable to persistent income differences.
Internal Migrants and Consumption Composition: Evidence from China
Felice Giulia;
2024-01-01
Abstract
This study examines differences in the composition of consumption between rural-urban migrants and urban residents in China, using household level data for the years 2007 and 2018. It sheds light on the main factors driving these differences and their evolution over time. To distinguish the role of income from other determinants of consumption, the analysis estimates the impact of migration on spending in agriculture, manufacturing, and services—both unconditionally and conditionally on total expenditure. While unconditional estimates capture the overall effect of migration, conditional estimates isolate the influence of institutional constraints and preference heterogeneity. The study further exploits variation in Hukou-related restrictions—across regions, policy types, and city sizes—to assess the relative contributions of regulatory barriers and migrants’ preferences. The findings show that migrants display a distinct consumption structure, particularly with a lower share allocated to services. In 2007, both lower income levels and institutional constraints contributed to these differences between migrants and residents. By 2018, a convergence in consumption patterns is observed, largely driven by rising migrant incomes and the loosening of institutional constraints. However, full convergence has not yet been achieved, with remaining differences largely attributable to persistent income differences.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
