Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/110754
Authors: 
Chen, Yiu Por (Vincent)
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 9024
Abstract: 
This paper explores the relationship between fiscal decentralization, which gave greater rural industrialization and fiscal authority to local governments, and the emergence of rural-rural undocumented inter-provincial labor migration during China's initial reform period. A Heckman model is employed to correct for the zero observation problems and to consistently estimate the labor mobility with a modified gravity equation. Given the institutional barriers, the fiscal decentralization has two contending effects on labor market integration: Local economic development promotes labor mobility, but local public goods crowding restrains the inflow of labor at the destination. The crowding effect is stronger at lower levels of government.
Subjects: 
fiscal decentralization
local economic development
local public goods
rural labor mobility
JEL: 
H30
J61
J68
D72
Document Type: 
Working Paper

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