China's Rural Labor Migration and Its Economic Development. Xiaoguang Liu

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      Note: *, **, and *** indicate statistical significance at 10%, 5%, and 1% levels, respectively. Moran’s I is the result of the spatial correlation test. The coefficients ρ and λ are the spatial correlation coefficients of the SAR and the SEM, respectively. R², adjusted R² and log-likelihood reflect the goodness of the fit of the model.

      The regression coefficient of the total factor productivity variable is significantly negative, indicating that the transfer of labor is weakened with the improvement of the level of technology. It is possibly because of the fact that the influence of total factor productivity on promoting the transfer of labor by output increase has been controlled by the variable of the growth rate of the GDP, the remaining influence shows that the technological progress is biased. The increase in the proportion of technologyintensive enterprises and capital-intensive enterprises reduces the demand for the transfer of agricultural labor, which is not conducive to promoting the transfer of agricultural labor. In addition, the FDI/GDP ratio also has a significant negative impact on the transfer of agricultural labor. This is possibly because of the fact that it is difficult for foreign enterprises to promote the transfer of agricultural labor due to higher requirements on human capital. However, the specific reasons still need to be further studied. Other variables such as CPI and the coefficient of the rate of registered urban unemployment are not significant, indicating that there may be no significant impact on the transfer of labor. However, the insignificant coefficient of the rate of registered urban unemployment may also be caused by the defects in the existing indicator of the rate of unemployment. However, the data from urban household surveys have been used to estimate the rate of surveyed urban unemployment in the nine provinces, and the results of the regression analysis are not significantly different (for the specific results, refer to Exhibit 1 of Appendix B).

3. Brief conclusions

      The main driving factors of the transfer of agricultural labor have been analyzed by using the panel data of China’s provinces and regions. The results of the analysis suggest that the urban–rural income gap, the improvement in the level of infrastructures, the increase in economic growth and return on capital and the decline in the proportion of stateowned enterprises or the development of the private sector are the main driving factors for the transfer of agricultural labor in China, and the current biased factors such as financial development and public education expenditure are not conducive to the transfer of agricultural labor.

      In the event of a large number of surplus agricultural labor force to be transferred in the real economy, China has shown the signs of widening the urban–rural income gap and slowing down the momentum of the transfer of labor, arousing concern about the sustainability of the “transition dividend” in the academic and industrial circles. In view of the large number of agricultural labor force to be transferred, the potential “transition dividend” will continue to play its huge growth effect for a long time, and it is not pessimistic about whether China can successfully get out of the middle-income trap. According to the results of the test in this section, the transfer of agricultural labor can be greatly promoted by improving the construction of infrastructure and promoting the development of the private sector.

      It should be especially noted that the improvement of the level of infrastructure not only effectively promotes the transfer of agricultural labor to the non-agricultural sector but also provides an important material basis for industrialization and urbanization. From an international comparison, the level of infrastructure has still a great deal of room for further improvement, despite the rapid growth in the scale of infrastructure in China in recent years.²⁶ The government should take the opportunity to strengthen the construction of infrastructure. Especially in a macroeconomic downturn, it is important to increase the economic efficiency and effectively raise the investments in infrastructures for the transfer of agricultural labor. In the short term, infrastructure investments, as a means of the government’s expansionary fiscal policy, can boost domestic demand and prevent excessive economic decline in the context of the current economic slowdown. In the medium to long term, the expansion of infrastructure can improve the efficiency of economic operations, facilitate the transfer of agricultural labor, narrow the urban–rural income gap and create favorable conditions for a smooth economic transformation, thus laying a solid foundation for China’s urbanization and modernization. Undoubtedly, it is necessary to pay attention to optimizing the direction and structure of government-led investments in infrastructure and appropriately encourage the introduction of some private capital in the course of practice to further utilize the functions of infrastructure in improving production efficiency and income distribution.

III. Technical Support for the Transfer of Agricultural Labor: The Revolution in Labor Productivity

      One of the indispensable basic conditions for China’s amazing achievements in economic development over the past 30 years is the constant improvement in the transformation and efficiency of China’s structure of agricultural production. As China is a populous country, agriculture is of a particularly important significance as the foundation of the entire national economy. Since the reform and opening-up, China’s agricultural labor force has kept shifting to the non-agricultural sector, which makes the proportion of the agricultural labor force in the total labor force decrease at an annual rate of more than 1 percentage point. The smooth transformation of China’s economy can be achieved only when the level of the productivity of the agricultural labor force is high and more agricultural products are obtained with less labor consumption. Only in this way can more of the agricultural labor force be transferred to the non-agricultural sector in the society to effectively back up the development of non-agricultural sectors, as well as economic and social transformation.

      It is very simple to explain why the development of a large country needs basic agricultural conditions. Improving the efficiency of traditional agricultural production is essential to the growth and transformation of a large economy with a population of more than one billion like China, especially the corresponding growth of agricultural labor productivity. Otherwise, the derivative law of the primary demand for food will fundamentally restrain the process of economic growth or indirectly restrict the process through the increase in agricultural prices beyond the acceptable range (especially for economies in the process of the transfer of agricultural labor). Marx once pointed out that the productivity of agricultural labor exceeding the individual needs of laborers is the foundation of all societies.²⁷ Modern developmental economics even views the growth of the productivity of agricultural labor as the premise for economic development because the food and raw materials produced by the agricultural sector constitute the conditions for the security of the basic materials that meet human existence and developmental needs. With the increase in the quantity of output per unit of labor, it is possible for the social economy to improve its efficiency by deepening the division of labor and to promote the development of material civilization. The practices of economic development in many countries, especially large countries in modern times, have provided extensive international experience to support and verify the above basic laws.

      The observation of the trajectory of the changes in the productivity of agricultural labor is not only an important subject in agricultural economics but also an indispensable aspect for an understanding of the basic prerequisites for the overall transformation of China, a huge economy. Specifically, how has the productivity of agricultural labor changed in China in the 60-year history of the development of new China, especially since the reform and opening-up? What are the characteristics of the trend of the changes in labor productivity at different times and for different categories? Is labor productivity measured by different indicators that are comparable or different? What is the changing situation of the productivity of the marginal agricultural labor СКАЧАТЬ