<abstract xmlns="http://www.w3.org/1999/xhtml"><p><italic>Hukou</italic> registration is an instrument to control nonplanned population and capital movements, which the Chinese Communist Party has been exploiting extensively since the 1950s. It requires that each Chinese citizen be classified as either an agricultural or nonagricultural <italic>hukou</italic> inheritor and be distinguished by their location with respect to an administrative unit. <italic>Hukou</italic> distribution used to be entirely determined by birth, but nowadays, Chinese citizens can self-select their <italic>hukou</italic> status based on their ability that causes selection bias in conventional wage decomposition by <italic>hukou</italic> types. To avoid this bias, I estimated <italic>hukou</italic>-based earning discrimination by matching Chinese individuals based on a rich set of individual-, family-, and society-level characteristics. By deploying a recent nationally representative dataset, this paper finds that significant earning discriminations exist against agricultural <italic>hukou</italic> people. I further investigated the impact of <italic>hukou</italic> adoption within work ownership, work and employer types, and labor contract conditions. I argue that earning difference by <italic>hukou</italic> is not due to rural–urban segregations; rather, it is systematic and institutionally enforced. This is because, contrary to self-employment and no labor contract conditions, discrimination exists only when others employ them and where a labor contract condition is enforced. Moreover, they face discrimination only when they work for the Chinese government, not when they work for private firms, and they face higher discrimination in nonagriculture-related professions compared to agriculture-related professions.</p></abstract>

Hukou registration is an instrument to control nonplanned population and capital movements, which the Chinese Communist Party has been exploiting extensively since the 1950s. It requires that each Chinese citizen be classified as either an agricultural or nonagricultural hukou inheritor and be distinguished by their location with respect to an administrative unit. Hukou distribution used to be entirely determined by birth, but nowadays, Chinese citizens can self-select their hukou status based on their ability that causes selection bias in conventional wage decomposition by hukou types. To avoid this bias, I estimated hukou-based earning discrimination by matching Chinese individuals based on a rich set of individual-, family-, and society-level characteristics. By deploying a recent nationally representative dataset, this paper finds that significant earning discriminations exist against agricultural hukou people. I further investigated the impact of hukou adoption within work ownership, work and employer types, and labor contract conditions. I argue that earning difference by hukou is not due to rural–urban segregations; rather, it is systematic and institutionally enforced. This is because, contrary to self-employment and no labor contract conditions, discrimination exists only when others employ them and where a labor contract condition is enforced. Moreover, they face discrimination only when they work for the Chinese government, not when they work for private firms, and they face higher discrimination in nonagriculture-related professions compared to agriculture-related professions.

Identity-based Earning Discrimination among Chinese People

IZA Journal of Development and Migration

This work is licensed under the Creative Commons Attribution 4.0 International License.

{"article-title":"Identity-based Earning Discrimination among Chinese People"}

Hukou registration is an instrument to control nonplanned population and capital movements, which the Chinese Communist Party has been exploiting extensively...

Identity-based Earning Discrimination among Chinese People

Published Online: Apr 02, 2020

Page range: -

DOI: https://doi.org/10.2478/izajodm-2020-0005

Keywords
labor market, earning discrimination, development, migration, matching estimator, China

© 2020 Abu Bakkar Siddique, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Identity-based Earning Discrimination among Chinese People

Published Online: Apr 02, 2020

Page range: -

DOI: https://doi.org/10.2478/izajodm-2020-0005

Keywordslabor market, earning discrimination, development, migration, matching estimator, China

© 2020 Abu Bakkar Siddique, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
labor market, earning discrimination, development, migration, matching estimator, China