Productivity and Welfare of Migrants in Chinese Megacities

We study productivity and welfare provision in megacities in China. We develop a model of internal migration to megacities under the Hukou system regulating public services to explore the impact of restricting migrants’ access to public goods/services on their overall utility and utility derived from using key public services; and quantify how migration distorts the effect of income on utility, and how migrants contribute to the productivity of high tech sectors.