Economic incentives and settlement intentions of rural migrants: Evidence from China

Based on a large, nationwide, household-level survey data set collected in 2014, this article investigates the effect of economic incentives on the destination choices of Chinese new-generation rural migrants. Empirical results show that economic incentives have a significant positive impact on the probability of rural migrants' urban settlement intentions but with a diminishing marginal effect. We also find that the marginal effect of economic incentives on rural migrants' urban settlement decreases with the distance to their hometown. Furthermore, the variations of the impacts of economic incentives on rural migrants' settlement intentions are investigated with respect to education level, employment status, and regional heterogeneity. Finally, we discuss policy implications resulting from our empirical analysis.