Migration and the Reshaping of Consumption Patterns

• Applicant: Dr. Elie Murard, since 7/2016
• Subject Area: Economic Policy, Applied Economics
• Term: from 2014 to 2018
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 258464668

• Final Report Year: 2019

Final Report Abstract

Internal migration in China has rapidly increased in the past thirty years, with an enormous amount of individuals temporarily leaving rural areas to work in urban areas with better economic conditions. On parallel, international migration from China has been growing, with many young talented Chinese migrants moving to European countries to further their education in disciplines in which Europe typically has a scarce supply. In this context, our project aimed at investigating how migration reshapes the consumption patterns of migrants and other individuals indirectly affected by migration. Our focus was on both the Great Migration in China and the Chinese diaspora in the EU. This project brought together collaborations across 6 institutions in France (GATE), Germany (Institute for Labor Economics, IZA)), the UK (University of Southampton and University of Nottingham) and China (Beijing Normal University (BNU) & Chinese Academy of Social Sciences (CASS)). The first important outcome of this project has been establishing and developing collaborative research among researchers from these different institutions, as well as enabling knowledge exchange of methods, data resources, literature and analytical skills. One of the other main outcomes has been developing a unique online survey of students in China (MARCO_P survey). This survey sheds light on how migration influences consumption and allows comparing consumption behaviour between students coming from different provinces of China and how it evolves over time (e.g., by comparing students in different cohorts). While we were able to secure a satisfactory response rate from students who were present in the universities where we conducted the survey, a very small number of Chinese students who were studying overseas at the time of the survey participated. This limits the quantitative analysis that one could perform using the sample of international students (e.g. comparing their consumption behaviour before or after returning to China), albeit interesting qualitative comparisons with other students (i.e. those who did not migrate) are still feasible. Importantly, our data still allow us to study the link between migration and consumption by looking at regional migration within China or by linking consumption behaviour with national/international migration intentions. The project has improved our understanding on how migration reshapes consumption patterns. Our main findings are the following: (i) Remittances send by internal migrants in China supplement income in rural areas and lead to increased consumption rather than increased investment. Households who receive remittances allocate a small share of their budget to education purposes (ii) Chinese students with international migration experience allocate a higher share of their monthly budget to sports but a lower share to food, relative to non­ migrants; they also have broader social media networks than internal migrants in China and non-migrants (iii) Rural-urban migrant returnees in China are more likely to smoke and drink alcohol compared to non-migrants and relative to before migrating (iv) Having a migrant member increases the probability that left-behind households participate in the stock market (v) Weak ties are complementary to strong ties in driving rural-urban migration in China.

Publications

• (2016). Remittances and expenditure patterns of the left behinds in rural China. China Economic Review, 37,177-190
  Demurger, S., & Wang, X.
  
• (2016). Remittances and relative concerns in rural China. China Economic Review, 37,191-207
  Akay, A., Bargain, 0. B., Giulietti, C., Robalino, J. D., & Zimmermann, K. F.
  
• (2017). Does migrating with children influence migrants' occupation choice and income? Journal of the Asia Pacific Economy, 22(1), 156-172
  Xing, C., & Wei, Y.
  
• (2017). The preference for larger cities in China: Evidence from rural-urban migrants. China Economic Review, 43, 72-90
  Xing, C., & Zhang, J.
  
• (2018). Strong versus weak ties in migration. European Economic Review, 104,111-137
  Giulietti, C., Wahba, J., & Zenou, Y.
  
• (2019). China's “Great Migration": The impact of the reduction in trade policy uncertainty. Journal of International Economics.
  Facchini, G., Liu, M. Y., Mayda, A. M., & Zhou, M.
  
• (2019). Unequal migration and urbanisation gains in China. Journal of Development Economics
  Combes, P. P., Démurger, S., Li, S., & Wang, J.