Introduction

Migration simply did not figure in the first of the China Household Income Project (CHIP) volumes, which was based on a 1988 national household survey (Griffin and Zhao 1993). This was partly because that survey relied entirely on samples drawn from the annual national household survey of the National Bureau of Statistics (NBS), which contained only rural households and urban hukou (household registration) households. That sampling procedure in turn reflected the underlying reality: rural-urban migration was restricted, limited, and unimportant. The same is true of the volume based on the 1995 CHIP survey (Riskin, Zhao, and Li 2001), although it contains an analysis of migrants based on the rural sample (Li 2001). The 2002 CHIP survey was the first to include a separate sample of rural migrants to the cities, and migrants were integrated into several of the chapters in the resultant volume (Gustafsson, Li, and Sicular 2008). A sample of rural-urban migrants was again included in the 2007 CHIP survey, on which the current volume is based. The greater emphasis given to migrants and migration in each succeeding CHIP survey reflects an important development in the Chinese economy. What has been referred to as the greatest migration in human history is now critical to an analysis of China's economic growth, income distribution, poverty alleviation, and labor market. Indeed, it is the subject of a separate volume that is also based on the 2007 survey (Meng and Manning 2010), but that volume does not address the question posed in this chapter.

The famous Lewis model (Lewis 1954) provides a good framework for evaluating the success of a developing economy and for explaining the ways in which the fruits of economic development are spread. Within a competitive market economy, it is only when the economy emerges from the first, labor-surplus, classical stage of the development process and enters the second, labor-scarce, neoclassical stage that real incomes generally begin to rise.