Chinese Economics Thread

Ultra

Junior Member
Is this true? I didn't know China had a citizen registry that classified rural individuals in such a way as to identify them as a sub-class and restrict their free movement within the country. That would be a significant social policy block to economic growth, if true.



Its called "hukou" ("戶口").

A hukou is a record in the system of household registration required by law in both
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of the
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and the
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of the
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. The system itself is more properly called "huji", and has origins in
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.

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What it boils down to is this:
The hukou system, introduced in the 1950s, ties people's access to services to their residential status. When controls on movement were relaxed, tens of millions of migrant workers left the fields to work in factories, toil on building sites, serve in restaurants or clean homes, contributing to China's spectacular economic growth.

But while they have built new cities and boosted their incomes, they have not enjoyed the same benefits in healthcare, pensions and other social welfare as city residents. Their children often struggle to access education; tens of millions have been
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to be raised by grandparents.

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You can google "Hukou system" as there are a lot of news about this hubub for the past few years.
 

Zool

Junior Member
Interestingly, the CPC is starting a new program to support growth back home for those rural workers and bring a level of development to the country side through small business. Very topical to our current discussion and a smart move - small business has been a strong engine for growth in North America and turning rural areas into modern suburbs.

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by
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June 24, 2015

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Farmers plant rice seedlings in a field near a residential compound in Shaxi township, Guangdong province March 29, 2015. China's leaders hope to encourage migrant workers to leave cities and return to their home villages to start small businesses. (Stringer/REUTERS)
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By Lincoln Davidson

Lincoln Davidson is a research associate for Asia Studies at the Council on Foreign Relations.

Earlier this week, the Chinese government announced a set of policies aimed at encouraging migrants from rural areas to the cities to return to their hometowns and start businesses. The
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direct local governments to encourage migrant workers (as well as university graduates and discharged soldiers) to take the capital, skills, and experience they’ve acquired in urban areas back to underdeveloped rural areas and engage in entrepreneurship. These policies—think of them as the newest iteration of Deng Xiaoping’s
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—are a solid step towards promoting genuine market-driven development.

People’s Daily
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that under the new policies local governments will employ the following five measures aimed at expanding rural entrepreneurship by returning migrants:

  1. Reduce “barriers to returning to rural areas” by providing training to returning migrants and reducing administrative fees for starting a business.
  2. Cut taxes for qualifying enterprises and individuals.
  3. Expand support for such enterprises, by providing subsidies, connecting them to local business networks, and helping them set up ecommerce platforms.
  4. Provide financial support for qualifying enterprises and individuals, by providing subsidized loans and expanding credit availability in rural areas.
  5. Increase support for entrepreneurial parks in rural areas.
The policy comes at a time when the rate of migration to the cities is slowing. While migrant wages in China continue to grow, the rate of growth of the migrant workforce has
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, dropping from 5.5 percent growth in 2010 to just 1.3 percent in 2014. Government data also show that the number of rural residents employed near their hometown has grown at a faster rate than the migrant population over that time frame.

Despite these trends in the labor force, these policies are long overdue. Although recent reforms have
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China’s household registration system, known as thehukou system, movement to urban areas is still not always an option for rural residents. And in the countryside, where there’s
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,
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, and
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, it can be much harder to start a small business than in the city.

By addressing the disparity between urban and rural residency, these policies are an important step forward in reducing the
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of being born in the Chinese countryside and a significant corrective to years of short-sighted development strategies in the Chinese countryside. Just as liberalization and the increased access to opportunities that accompanied it
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(and movement back towards state-driven development drove them down in the ‘90s), policies promoting rural entrepreneurship have the potential to significantly improve the economic situation of millions of Chinese rural residents today. At the same time, innovative agricultural ventures have an important role to play in
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. While this policy may not lead to more
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, it is aimed at upgrading agriculture and cultivating the services to support it.

There has long been anecdotal
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that potential income increases are not the sole—or even primary—factor motivating young Chinese to seek employment in urban areas. Among the many reasons that rural residents choose to head to the cities, a commonly seen one is a desire for self-improvement. Building on this,
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by researchers at the University of Pennsylvania found that the desire for personal development is a significant motivator behind the migration decisions of youth from rural areas in Gansu Province.

The new policies also speak to these individuals. Having gone to the cities to learn and grow, they now have a chance to return home and use their know-how to start up a business, taking on new challenges (and new opportunities for personal development) in the process. By providing training and support services, the new policies can help these entrepreneurial individuals transition from laborer to small business owner. At the same time, it could mitigate the
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that has drawn the best and brightest to urban areas, further sapping the already lagging rural regions of economic vitality.

Of course, given how
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and
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policy implementation by local governments tends to be in rural China, it remains to be seen what impact these new policies will have. Local governments already facing fiscal crisis will not be thrilled at the prospect of providing subsidized loans and additional services, and verifying the status of returned migrants could prove to be an additional outlet for corruption. However, with its focus on small, entrepreneurial ventures by individuals, this policy has the potential to move the Chinese economy away from
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toward private sector investment in productive assets. And in the long run, that could mean higher standards of living for millions of rural Chinese.
 

Zool

Junior Member
Also related:

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(Xinhua)Updated: 2015-02-05 15:31

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Chen Guoliang (R), 26, and Lu Man, 24, both with master's degree, gave up job offers and returned to countryside to develop agriculture. [Photo/CFP]



BEIJING - As rapid urbanization continues, some youngsters are bucking this trend and pursuing better career prospects in the countryside.

Yan Qiang was born in Chongqing municipality in Southwest China. After graduating from college last year he rented a plot of land in the suburbs of Changsha city in Hunan province and started a community supported agriculture (CSA) company.

His customers want to support local farms and do so by paying for a share of the expected harvest at the start of each growing season.

"Many of my peers are passionate about starting their own business and some have discovered opportunities in the countryside," he said.

Born in a small village in the southern Hainan province, Chen Tongkui was the first in his village to go to college. After graduating he worked as a journalist in Shanghai for seven years, before leaving in 2009 to return to his hometown to become a farmer.

Since then, he has championed ecological agriculture and agricultural tourism to his fellow farmers.

Chen also organizes a forum for college graduates interested in working in the countryside. The event, which has been held for three years, attracts hundreds of participants each year.

In the pursuit of happiness

Today the youth are choosing to go back to countryside, thanks to the government's emphasis on agriculture and the Internet.

China released its annual "Number One Central Document", the first major policy document of 2015, on Sunday, which pledged further coordinated development of cities and villages. This is the 12th consecutive year that the document has focused on agriculture.

In February 2014, a Ministry of Agriculture guidance suggestion asked local governments to issue policies that would encourage graduates to establish farms.

Meanwhile, the boom of China's e-commerce sector, combined with the development of transportation and logistics, are also supporting countryside entrepreneurs.

Many countryside entrepreneurs depend on computers and mobile devices to support their daily tasks.

Three years ago, Liu Jingwen launched an e-commerce company for local farmers in Xinjiang's Kashgar Prefecture.

Recalling his first visit to Kashgar three years ago, Liu said: "Their agriculture and traditional businesses were well established, but they knew nothing about e-commerce. So, I jumped at this opportunity."

According to Liu, his website has really improved the farmer's incomes.

"Uncle Murtal only made 6,000 yuan ($960) during his first year of selling online, but this soared to 25,000 yuan in the second year." he said.

Invigorate the countryside

China's urbanization rate exceeded 54 percent in 2014, according to the National Bureau of Statistics, meaning that society has become increasingly more polarized.

Yang Tuan, researcher with Chinese Academy of Social Sciences, said: "Rural areas lack talent, which is impeding development. This reverse trend will inject vitality into the countryside economy."

The young are not only bridging the development gap between rural and urban areas, but are also promoting mutual understanding and trust through business connections.

However, starting a business in the countryside is no easy task.

According to a poll of over 4,000 college graduates majoring in agriculture-related subjects, about 67 percent were interested in starting businesses in the countryside, but less than 7 percent actually took action.

A report on the results, published by Shandong Jianzhu University last August, found that underdeveloped infrastructure, financing difficulties and lack of experience were some of the major obstacles.

It suggested that governments should further promote preferential policies for countryside entrepreneurs, and colleges should offer relevant courses to better prepare students.

Moreover, attitudes toward farming must change.

When Yan Qiang told his parents that he was going to start a farming business in the suburbs, his parents were embarrassed of their son's chosen career path.

"You have to be courageous and must stand firm, even when faced with stereotypical opinions," Yan said.
 

tphuang

Lieutenant General
Staff member
Super Moderator
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Registered Member
Can an individual be registered in multiple cities? What about a transplant? or is a person 'fixed' to city of birth forever on paper?

If you are referring the Hukou system, it is the same as the Japanese Koseki system according to wikipedia. I think any shortcomings with this system are administrative in nature and will change as the nation becomes more developed like what has happened in Japan and Korea. Controlling city population is a necessary administrative function of government. Are City folks disallowed to live in the countryside if they so decide?


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True democratic nations does not restrict moving from one place to another and can live anywhere without changing registry. From what I have previously read, PRC doesn't provide those luxury and you need to jump a lot of hoops as well sell off rights to change from rural area registration to city registration. Without them even if you find a home in the city side their child will not be allowed to attend the school near them nor gain medical treatment.

Japan's family registration(koseki [戸籍]) does not restrict me from anything. You can file a resident registration(Jumin Toroku[住民登録]) to any local government and it will take care of public schooling for the kids and universal health insurance for the family as long as you pay the taxes.
Family Registration is to keep record of birth place/date and marrige records to file next of keen to prove Japanese nationality.

I don't know of how Japan's system work, but if it works like state id here in America, then the Chinese system is definitely more restrictive system. Although based on SB's comments, it seems to be less free than the American system.

So hukou does not restrict you from moving anywhere. A lot of people move from country side or smaller cities to the larger cities in the coastal area for work. Back in the days, having a hukou of a big city was a big deal, so a lot of people really want to get one. You are certainly not fixed to one city. You move to other cities and change your registration. I don't think you are legally allowed to have more than 1 hukou, but there are certainly people with power and privilege that have more than 1.

A lot of the so called difficulties are economically related. A rural migrant worker is going to be less educated and have little money, so they end up having to live in more remote part of the city and send their kids to schools for just the rural migrant workers and such. If you don't have Beijing's hukou and you are well educated and have some wealth, you are not going to face the same level of difficulties. The bigger issue facing outsiders in Beijing or Shanghai is that they are looked down on by locals, so it's harder for them to find marriage partners with native Beijing and Shanghai residents. Also the Beijing or Shanghai residents generally have housing whereas outsiders have to face the astronomic cost of buying new homes in their new city, which is very expensive. And finally, local government works harder to address employment of people registered to its city, so certain jobs (like for example cab drivers in Beijing) can only go to people with local registration.

In terms of lack of free health care for migrant workers, I think the question is why do you think free health care should be something that local government provides to everyone? Granted, I live in America and don't believe in socialized health care, so I don't have a problem with China's system. The bigger issue with China's health care system has to do with high level of corruption and bribery that has nothing to do with whether you are registered or not. Regardless of whether someone is registered in a city, they have to deal with bribing doctor's to get better treatment. So in the end, it all comes down to how much money you have. And unfortunately for the migrant workers, most of them don't have money, so it's pretty tough. But if you are a new university graduate who got a job in a tech firm in big city, these are not the kind of things you need to worry about. I have relatives live in different part of China. I've never heard any of my relatives complain about the injustices of not having hukou. Focus on the marriage partner and housing situation, those are the biggest issues facing someone in the new city.
 

Equation

Lieutenant General
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YANJIAO, China — Every morning at 5:30, Liu Desheng joins a dozen retirees waiting for the express bus to central Beijing from this small city in Hebei Province. They stand at the front of the line but never board, instead waiting as bus after bus pulls up, each picking up 50 people from the ever-lengthening line behind the retirees.

Around 6:30, their adult children arrive. The line, now snaking down the street, has become an hourlong wait. People cut in, and a shoving match breaks out. But the retirees have saved their children this ordeal. When the next bus pulls up, the young adults take their parents’ places at the head of the line and board first, settling into coveted seats for a 25-mile ride that can take up to three hours.

“There’s not much I can contribute to the family anymore,” Mr. Liu, 62, said as his son waved goodbye from a bus window. “He is exhausted every day, so if I can help him get a bit more rest, I’ll do it.”

The Liu family’s commuting habit is a small but telling part of a megacity in the making.

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Slide Show
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SLIDE SHOW|7 Photos
In China, a Supercity Rises
In China, a Supercity Rises

CreditSim Chi Yin for The New York Times

For decades,
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’s government has tried to limit the size of Beijing, the capital, through draconian residency permits. Now, the government has embarked on an ambitious plan to make Beijing the center of a new supercity of 130 million people.

The planned megalopolis, a metropolitan area that would be
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, is meant to revamp northern China’s economy and become a laboratory for modern urban growth.

“The supercity is the vanguard of economic reform,” said Liu Gang, a professor at Nankai University in Tianjin who advises local governments on regional development. “It reflects the senior leadership’s views on the need for integration, innovation and environmental protection.”

The new region will link the research facilities and creative culture of Beijing with the economic muscle of the port city of Tianjin and the hinterlands of Hebei Province, forcing areas that have never cooperated to work together.

This week,
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, vowing to move much of its bureaucracy, as well as factories and hospitals, to the hinterlands in an effort to offset the city’s strict residency limits, easing congestion, and to spread good-paying jobs into less-developed areas.

Jing-Jin-Ji, as the region is called (“Jing” for Beijing, “Jin” for Tianjin and “Ji,” the traditional name for Hebei Province), is meant to help the area catch up to China’s more prosperous economic belts: the Yangtze River Delta around Shanghai and Nanjing in central China, and the Pearl River Delta around Guangzhou and Shenzhen in southern China.

But the new supercity is intended to be different in scope and conception. It would be spread over 82,000 square miles, about the size of Kansas, and hold a population larger than a third of the United States. And unlike metro areas that have grown up organically, Jing-Jin-Ji would be a very deliberate creation. Its centerpiece: a huge expansion of
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to bring the major cities within an hour’s commute of each other.

But some of the new roads and rails are years from completion. For many people, the creation of the supercity so far has meant ever-longer commutes on gridlocked highways to the capital.

Encouraged by Hebei Province’s relatively open residency policies and inexpensive housing, people are flocking to suburbs like this one. Yanjiao has grown tenfold, to as many as 700,000 inhabitants, in a decade. But it remains a bedroom community for Beijing — a swath of apartment towers and restaurants with few services.

Photo
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On a Sunday in March at one of the two parks in Yanjiao, China, residents found limited space. CreditSim Chi Yin for The New York Times
“The streets flood in the rain because there is no good drainage,” said Xia Zhiyan, a 42-year-old employee of a printing company. “They just built more and more apartments without the most basic facilities.”

Even by the cheek-by-jowl standards of Chinese public spaces, Yanjiao’s main park is hopelessly crowded. On a recent Sunday afternoon, in-line skaters bumped into each other at a strolling speed, kite lines crossed in the air, and older men politely jostled each other as they practiced calligraphy with water brushes on the sidewalk.

The lack of services reflects deeper challenges. With no property taxes, Chinese cities rely on public land sales for tax revenues. Municipalities are not allowed to keep other locally raised taxes, for fear that local leaders will misuse the proceeds.

So a bedroom community like Yanjiao has no way to pay for new schools, roads or enough bus service so that retirees do not have to stand in line on behalf of their children. Changing this would require restructuring how taxes are collected and distributed, an overhaul that is not on the table. Even though the supercity will consolidate affluent Beijing with tax-starved towns like Yanjiao, they will not share revenue.

Photo
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Dawn over a residential complex in Yanjiao. CreditSim Chi Yin for The New York Times
Infrastructure has also lagged. Until recently, high-speed rail failed to connect many vital cities around Beijing, while many roads did not link up. Planning reports say the area has 18 “beheaded” highways — major arteries built in one of the three districts but not linked to others. One highway ends at a bridge over the mostly dried-out river dividing Yanjiao from Beijing, and has remained unfinished for years.

But several factors are making Jing-Jin-Ji a reality. The most immediate is President Xi Jinping, who
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in 2013 and has endorsed the region’s integration.

The plan calls for eliminating the “beheaded highways” by 2020 and constructing a new subway line. In addition, the plan assigns specific economic roles to the cities: Beijing is to focus on culture and technology. Tianjin will become a research base for manufacturing. Hebei’s role is largely undefined, although the government recently released a catalog of minor industries, such as wholesale textile markets, to be transferred from Beijing to smaller cities.

Beijing is shifting much of its city administration to the Tongzhou suburb, ending the longstanding practice of putting government offices in the old imperial district.

The plan has started to drive up property prices in the suburbs,
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Improving the infrastructure, especially high-speed rail, will be critical. According to Zhang Gui, a professor at the Hebei University of Technology, Chinese planners used to follow a rule of thumb they learned from the West: All parts of an urban area should be within 60 miles of each other, or the average amount of highway that can be covered in an hour of driving. Beyond that, people cannot effectively commute.

High-speed rail, Professor Zhang said, has changed that equation. Chinese trains now easily hit 150 to 185 miles an hour, allowing the urban area to expand. A new line between Beijing and Tianjin cut travel times from three hours to 37 minutes. That train has become so crowded that a second track is being laid.

Now, high-speed rail is moving toward smaller cities. One line is opening this year between Beijing and Tangshan. Another is linking Beijing with Zhangjiakou, turning the mountain city into a recreational center for the new urban area, as well as
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.

“Speed replaces distance,” Professor Zhang said. “It has radically expanded the scope of what an economic area can be.”

Wang Jun,
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, said creating the new supercity would require a complete overhaul of how governments operated, including instituting property taxes and allowing local governments to keep them. Only then can these towns become more than feeders to the capital.

“This is a huge project and is more complicated than roads and rail,” he said. “But if it can succeed, it will change the face of northern China.”

Whoa..it's like combining Houston, Dallas, San Antonio, and Austin into one ginormous city.:eek::)
 

janjak desalin

Junior Member
I think many, here, will enjoy this read:
China Molds a Supercity Around Beijing, Promising to Change Lives
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Quote: "The new region will link the research facilities and creative culture of Beijing with the economic muscle of the port city of Tianjin and the hinterlands of Hebei Province, forcing areas that have never cooperated to work together."

And: "Jing-Jin-Ji, as the region is called (“Jing” for Beijing, “Jin” for Tianjin and “Ji,” the traditional name for Hebei Province) ..."

That's so cool! I want a Jing-Jin-Ji t-shirt!
 

Jeff Head

General
Registered Member
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Whoa..it's like combining Houston, Dallas, San Antonio, and Austin into one ginormous city.:eek::)
It's going to be like the US NE Corridor.

Basically, from Washington DC to Boston you have one giant megapolis...a few areas of country in-between...but not many, and suburbs for the various cities all running together throughout.

I REALLY liked th story of the retirees holding the place in line for their working children each day. God bless 'em for those acts of kindness and family unity.
 

solarz

Brigadier
Japan's family registration(koseki [戸籍]) does not restrict me from anything. You can file a resident registration(Jumin Toroku[住民登録]) to any local government and it will take care of public schooling for the kids and universal health insurance for the family as long as you pay the taxes.

So what happens when the public schooling and health care systems are already overloaded?
No one complains about not being able to get a hukou in the middle of nowhere, it's always Shanghai and Beijing that have these restrictions. This is simply because those cities can only support a certain number of services.

You cannot compare this to Japan or other developed nations. No developed nation has the amount of migrant workers that China does, and if they did, they would be forced to come up with a similar system. It is said that Shanghai has a migrant population that accounts for 40% of its total population: 14 million residents, 9 million migrants. Imagine Tokyo having to deal with another 9 million people, and tell me those people would get unrestricted access to schooling and health care.
 

janjak desalin

Junior Member
It's going to be like the US NE Corridor.

Basically, from Washington DC to Boston you have one giant megapolis...a few areas of country in-between...but not many, and suburbs for the various cities all running together throughout.

(...)

The Times has updated the article with a map and a video reading of the article.
I've always loved the Times 'cause they always include a map with their articles about places. Here's my crude hack of the map:
2.jpg
 
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