Chinese Journal of Sociology ›› 2017, Vol. 37 ›› Issue (5): 217-241.

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The Change of “Agricultural” to “Non-Agricultural” hukou,Return of Human Capital and the Earnings Gap between New Citizens and Original Residents

WANG Peng   

  1. Center for Studies of Sociology Theory & Method, Renmin University of China
  • Online:2017-09-20 Published:2017-09-20

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Abstract:

The segregation of urban and rural household registration system(hukou)is always considered to be one of the most important causes of Chinese income inequality. Under the background of the accelerated process of urbanization in China,millions of peasants have transformed their hukou status and become new citizens in the sense of household registration system. It is still a question whether these people share the equal opportunity in competition with urban natives,although they have enjoyed same privileges attached to the non-agricultural hukou. Meanwhile,the heterogeneity in new urban residents who come from agricultural sector should not be neglected.By using the data of Chinese General Social Survey (CGSS),we found that there exists earnings gap between new citizens and original residents who born with urban hukou,while the gap cannot be explained by the difference of human capitals. The result of quantile regression decomposition shows that new citizens may still suffer the discrimination in labor market. The discrimination may derive from both institutional and non-institutional factors,presenting an inverted U shaped curve with the change of unconditional income quantiles. Meanwhile,there is also significant difference within the group of hukou-transformed-people. The discrimination offsets the human capital advantage of endogenous new citizens compared with old ones,while the exogenous new citizens face the disadvantage of human capital and the discrimination of labor market at the same time. We still don't know whether the discrimination exists during the transformation of hukou,or after this process,but this dimension of income stratification can be considered the subsequent effect of household registration system.

Key words: household registration, human capital, earnings inequality, quantile regression