Does the revised hukou system facilitate or restrain the short-term labor inflows into Chinese cities?

Abstract

According to previous studies, the Chinese revised Hukou system has not been proven to be effective in the short-term movement of the rural labor force or in controlling urban populations. In this study, we address and analyze the self-selection problem from the perspective of inflows of short-term migration from the rural labor force and the endogeneity problem in the adoption of the revised Hukou system, based on the data from China Family Panel Studies (CFPS). The study shows that the revised Hukou system adopted by Chinese local governments was significantly efficient and harmed the short-term migration decisions of the rural labor force.