RURAL-URBAN MIGRATION, LABOR MOBILITY AND AGRICULTURAL TRADE LIBERALIZATION IN CHINA

Under the terms of its accession to the WTO, China will likely commit to significant liberalization of its agricultural trade regimes. In this paper we consider how growing levels of urban unemployment, combined with a restrictive labor market policy, may alter the expected welfare effects of agricultural reform. We utilize a new AGE model of the Chinese economy based on the Harris-Todaro framework, incorporating imperfect labor mobility