Internal Economic Migration Case Study

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A fraction of China’s population, equivalent to the whole of Germany, has decided to undergo internal economic migration (Videographic). From 1990-2005, mass internal economic migration in China has shifted working rural populations towards urbanised cities nearing coasts; shown in Figure 1. Economic migration applies mostly to the young and skilled (Smeed), causing Sichuan’s dependency ratio/year to decrease by 33.33%; responsible for 20% of China’s economic growth (World). The effects of internal economic migration on the dependency ratio of Sichuan are positive for the area’s economic environment (ease to earn money). Changes in dependency ratio have affected remittances, employment opportunity, and tax pressure; ultimately positive for…show more content…
The unemployment rate in urban areas located in Sichuan decreased by 89.34% in one year (1979-1980), which provided support for 89.34% more people than pre-migration (“World”). Migration from Sichuan to western and central China slowly started in 1978 (Ping, Huang). This initial migration decreased dependency ratios, which increased demand for employees and factory workers. This translates to a decreased unemployment rate, which increases employment retainment. The newly available employment options furnished support for those searching for income. The ability to retain employment allows the Sichuanese to increase and/or sustain their income. The Economist States, “As more jobs are created in inland cities and provinces, more wealth is trickling down to rural areas too (Videographic).” The Economist states this in the context of factories changing locations. The wealth that is, “trickling down to rural areas,” supports those in need of employment. Factories relocate to employ workers at an economical cost. Workers that require pay at this rate strive to seize these employment options. Consequently, the wealth, “trickling down to rural areas,” goes directly to Sichuan's citizens that require said pay. The directing of money towards lower income families increases their chance to increase their assets. The increase of dependency ratios, the result of…show more content…
Companies in Sichuan earning less than ¥100,000/year pay five percent less corporate income tax than other businesses (Briefing). This illustrates a trend of, “the more successful the business, the more tax they have to pay.” Therefore, less successful businesses have less costs to subtract from gross profits. It requires less effort to grow a business if the business is susceptible of less costs. The government applies less corporate tax to less successful businesses, to increase their probability of growing and prospering. This would ultimately both create jobs, and increase Sichuan’s gross domestic product; which would lessen the hardships needed to earn money. Figure 2 shows that economic migrational patterns have changed, causing the dependency ratio in Sichuan to decrease. This is largely due to the Chinese government encouraging business in rural areas (Briefing). Figure 3 has wide, convex sides and a more narrow peak and base (in relation to the sides), which portrays the low dependency ratio in Sichuan, a direct result of tax pressure changes causing economic migration towards central and western China (Sichuan). Figures 2 and 3 (both come from case studies in Sichuan) confirm that dependency ratios have decreased due to inverted migrational patterns. Shown in Figure 2, the new destinations of migration include Sichuan, leading the working

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