Boosting rural labor off-farm employment through urban expansion in China

Abstract

Rural development is widely believed to interact with the structural transformation, but little is known about how this happens in developing countries. This paper explores the impact of structural transformation on rural development through the length of analyzing the role of urban growth in creating off-farm employment for rural labor in China. By combining five waves of farm surveys for 1,234 households for the period of 2000–2018 with a newly constructed urban gravity index for 370 cities, we show that rapid urban growth in China has significantly contributed to rural development by increasing off-farm employment for rural labor by 47–71 million since 2000. Moreover, the positive impact started with the emergence of a few large metropolitan cities but ended with the growth of local, relatively small cities, suggesting the interaction between structural transformation and rural development is at a nationwide level. Show more