Income transfers of Chinese rural migrants: some empirical evidence from Jinan

Abstract

This paper explores the determinants of migrant remittances to rural households using data on male migrant workers drawn from the Jinan Municipality in Shandong province in the summer of 1995. The majority of migrants are found to retain close links with their rural households with 85% remitting some income in the 12 months preceding the survey date. The transfers accounted for over a third of urban labour earnings. A number of models are used to undertake the estimation of remittance functions. No evidence of altruistic behaviour is uncovered and evidence for exchange and coinsurance theories is mixed. Labour earnings proved the most robust determinant of the level of remittance and the remittance/wage elasticity calculated is found to be at the top end of the range of estimates obtained in the literature.