An Empirical Research On Wage Differentials Between Urban Workers And Migrant Workers:

Following the reform of the household registration system and the gradual establishment of a unified labor market in China, Chinese society has undergone the new round sustained and massive transfer of rural labor to urban areas. As rural-urban migration keeps increasing, the wage differentials between urban workers and migrant workers are expanding. Human capital, labor market discrimination, or the premarket factors, which is the main cause of widening the wage gap between urban workers and migrant workers? Based on the questions above, this thesis analyzes empirically the status and composition of wage differentials between urban workers and migrant workers in Chinese urban labor market, and also investigates the intrinsic formation mechanism in it from aspect of human capital endowments, market discrimination, premarket factors and labor market segmentation.With sample survey data from Zhejiang Province, the thesis applies methods of econometrics and overlapping generation model to investigate empirically the outcome differentials between urban workers and migrant workers and the factors affecting it, as well as explore how the wage differentials determined by the Household Registration System logically. Firstly, based on taking psychological capital into wage function, the paper decomposes differences in average and across distributions of personal income by using Blinder-Oaxaca decomposition with endogenous variables and quantile decomposition methods. Secondly, the main factors and effect mechanism of expanding wage differentials are analyzed from human capital, social capital and psychological capital aspect. Finally, we describe the various forms of labor market segmentation in urban labor market and discuss the relationship between segmentation and the wage differentials.It is found that difference in individual endowment, especially human capital endowment, is the most important influence on wage differentials between urban workers and migrant workers. Even if the farmers no longer face discrimination in choosing to migrate to work in the urban labor market, the wage differentials between the two groups will not be eliminated. Education and health are the most important factors of human capital endowments which will improve migrant workers' wage. As well as, the contribution of psychological capital on wage differentials is greater than the role of social capital. Although, labor market discrimination accounts less for the wage differentials, the premarket factors, such as urban-based public human capital investment policies, have a major impact on wage differentials. The results also show that most part of the wage differentials is attributed to the sector and industry segmentation. Moreover, public-private sector segmentation and monopolistic segmentation are having a much greater impact on wage differentials between urban workers and migrant workers than ownership segmentation. At the other hand, the phenomenon of unequal pay for equal work becomes weaken in inter-sector and inter-industry, but becomes intensifying in monopolistic industries.Comparing with the existing concerned literature, the improvements of this thesis have been illustrated as follow. Firstly, this paper takes psychological capital into account, and empirically investigates the impact of non-psychological and psychological factors on the wage differentials. Secondly, under the human capital, social capital and psychological capital perspective, this paper makes a comprehensive study on the contribution of personal endowments to average and across distributions of personal income differences. Finally, using of Appleton decomposition method, this article explores the relationship between the labor market segmentation and wage differentials.