1. Introduction
The issues related to the location choice and livelihoods of rural-urban migrants are critical to the sustainable development of cities [
1,
2,
3,
4]. In China, the influx of large-scale rural labor force into cities has promoted the optimal allocation of labor factors across regions [
5]. However, the settlement of migrants is unstable and reciprocating, migrants often move back and forth in the working place and the out-flow area because of the high living cost and the deficiency of the urban public service provide for them [
6]. According to the data of the Seventh National Population Census, China’s urbanization rate rises from 17.92% in 1978 to 63.89% in 2020, and the number of migrants has reached 376 million. Although China’s registered household system has been continuously liberalized in recent years, the access threshold in megacities is still very strict. Recent reforms in urban housing provision seem to overlook the needs of the migrants. Therefore, it will be interesting to observe the subjective willingness of migrants to settle permanently in the working city, to provide a perspective for realizing the “citizenship” of the floating population in developing counties.
There is abundant research on the motivation of migration, and the influencing factors can be summarized as demographic characteristics (age, gender, marital status, and education), economic factors, family characteristics, city-level factors, climate, and so on [
1,
3,
5,
7]. Scholars reach a consensus that the distribution of migrants primarily focused on the areas where jobs are available [
8]. And there is a negative correlation between housing prices and migration. Helpman [
9] first studied the impact of house prices on migration, and Potepan [
10], Jeanty [
11], and Saiz [
12] verified that house prices are not conducive to migration intention. But there is a positive correlation between access to formal housing and stronger settlement intention [
13]. However, as the crucial element of urban settlement associated with hukou, housing remains difficult to attain for Chinese migrants, making them hard to settle permanently in large cities [
14,
15]. Besides, some studies analyzed the effect of migrants’ health and their social integration in the city. Results show that physical and mental health are both important to the settlement intention of migrants, and the interaction with local urban residents is crucial for their urban integration [
5,
16,
17]. Some scholars also studied the institutional factors and found that
hukou had a significant negative binding force on migration due to the strict
hukou rules in megacities [
18,
19,
20].
Recently, the emerging body of studies begin to bring urban public welfare in understanding the location choice of migrants [
4,
15]. Tiebout (1956) first put forward the view that people prefer to live in communities with higher public service levels and proposed the rule of “voting with their feet” [
21]. Under this role, the higher the level of urban public services, the stronger the willingness of the floating population to settle permanently [
22]. More importantly, the public service level is closely related to the city size. The bigger the city size, the more resource allocation, and institutional preferences the city enjoys [
2,
23]. In China, large cities seem to be more attractive than small cities. The economies of scale effect promote the employment probability, and the urban wage premium further leads to the inflow of labor force choosing big cities [
24,
25,
26]. Furthermore, considering the heterogeneity of migrants, the urban agglomeration effect has a stronger impact on highly skilled migrants [
27]. However, other scholars believe that the interaction between the agglomeration effect and crowding effect leads to an inverted U-shaped relationship between city size and labor productivity [
28,
29]. The impact of housing cost on migration is also related to city size. In China, due to the high burden of housing prices, the crowding effect is greater than the agglomeration economics in mega-cities, resulting in a decline in the attraction of cities to migrants, especially the highly skilled migrants [
30,
31]. So far, there’s only one study that closely focuses on city size and migrants’ settlement intention [
32]. But this research defines city size as a city as a category and analyzes the intention of hukou transfer, which is different from the migrants’ permanent settlement intention.
Based on the classical economic theory, the premise of labor migration is that the return of scale is constant [
33,
34,
35]. The limitation of the classical economic theory is that it cannot explain the agglomeration effect brought by large cities to migrants. The “Core-peripheral Model” established by the new economic geography theory represented by Paul Krugman breaks through the constant returns to scale in classical economic theory and adds the spatial agglomeration to provide a more reasonable way for explaining the flow of labor to big cities [
36,
37]. Based on the previous studies, this paper makes conceptual and empirical contributions to the understanding of migrants’ urbanization in different cities. The contributions of this paper are as follows. First, this paper expanded the Rosen–Roback model, and include the social relationship network and air pollution closely related to the city size into the model, which is more in line with the welfare needs of migrants; second, in addition to the spillover effect of wages, this paper finds that city size also brings the spillover effect of social capital to the migrants, that is, the interaction term between the social network of local people and city size is significantly positive, which reveals that the promotion effect of local social network on settlement intention will be significantly strengthened with the city size. Third, in the analysis of housing cost, this paper also distinguishes the impact of rent and housing price on settlement intention. Our results reveal that Chinese migrants are very concerned about the acquisition of housing ownership. The permanent settlement of China’s floating population, both rental cost and house prices will have a significant inhibitory effect.
The remainder of the paper is structured as follows.
Section 2 introduces the theoretical analysis framework.
Section 3 reports the data source, empirical model, and variables statistics.
Section 4 reports the empirical results, the endogenous and robustness checks. Finally,
Section 5 draws the main conclusions.
2. Theoretical Analysis Framework
It is widely documented that large cities seem to be more attractive than small ones [
3,
20,
38]. Why do people prefer to live in one city instead of another? The choice depends on which city’s amenity values will maximize the individual utility [
39]. Based on Rosen and Roback’s theory, an analytical framework of general spatial equilibrium, which is supplemented by Glaeser, is proposed [
40,
41,
42]. The model assumes that there is an equilibrium between labor wages, living costs, and urban amenity when the basic assumption such as sufficient labor migration is satisfied. The living cost is closely related to the housing price and the rent cost, and the bad urban crowded environment [
43]. In recent years, the factors of climate amenity related to quality-of-life have been added to urban settlement decision-making [
44]. Albouy D. [
45] proposed adjusted amenity-value estimates which indicated that climate amenity such as mild seasons, sunshine, and coastal proximity account for most inter-metropolitan quality-of-life differences in the U.S. After that, Albouy et al. [
46] present a hedonic framework to estimate US households’ preferences over local climates. Meanwhile, Imbert [
47] provides new evidence on the costs and benefits of rural-urban migration in developing countries. In addition to higher living costs, the non-monetary costs of harsh living and working conditions in the city are the main barrier to migration.
Based on the analysis above, we extant the Rosen–Roback’s model for the equilibrium between wages, living cost, social network, and natural amenity to the concept of location choice of migrants in China. The model assumes that the labor mobility is free, the one who intends to permanently settle in the host city is decided by the utility function which includes the wages, living cost, social network, and natural amenity. The utility function and the constraints condition equation are then defined as:
where
U represents the utility of the rural-urban migrants working in the city,
is the labor productivity in the city
i.
is the housing cost in the city
i in the period of t, while we treat the price of other commodities standardized to 1. The number of general commodities and houses consumed by each migrant in the
t-period are respectively by
and
.
represents the non-monetary factors, such as social network, and
indicates the PM
2.5 , annual temperature, and annual precipitation in the city. The agglomeration economy has a positive impact on urban wage premium. The larger the city size, the higher the wage premium. Migrants have to pay a certain proportion of their wages in exchange for living opportunities in large cities [
4].
Based on the above analyses, we draw a conceptual framework for migrants’ willingness to settle permanently in the context of city size. The choice of location is the result of various factors. The factors that influence the choice of settlement intention among migrants include characteristic factors and unobserved effects. By using the classic binary logit method, this study analyzes the mechanism of the inverted U-shape trend of city size and the permanent settlement intentions of rural-urban migrants. This study uses domestic statistical data of Chinese migrants to address several questions on the heterogeneity of city size in China. What is the interpretation of each factor that leads to the inverted U-shaped trend of city size and settlement intention? How will the factors change that is related to the permanent settlement intention based on city size?
5. Conclusions and Discussion
In China, the quality of amenity that a city offers matters for the permanent residential choice of migrants. Using 2017 microeconomic data from the CMDS, this study used binary Probit model analysis to explore the effect of city size on the urbanization process in China. In general, results from the descriptive statistical results show that the longer the time of migration duration, the higher the wage level, and the closer the communication with local registered residents, the more conducive it is for migrants to settle permanently in the city. After controlling for the demography characteristics, health condition, urban amenity, and natural amenity, we find that there is an obvious inverted U-shaped relationship between city size and permanent settlement intention of Chinese migrants.
The empirical results show that two mechanisms are responsible for the influence of city size on migrants’ permanent settlement intention, that is, the agglomeration effect, and the crowing effect. The importance of amenities such as wage premium and social network externalities in urban markets are linked to city size. Both the coefficients of the interaction of city size and wage and the interaction of city size and urban social network are significantly positive, showing that city size not only brings the spillover effect of human capital investment but also produces the externality of social network on permanent settlement intention of migrants. On the other hand, city size also brings a crowding effect to migrants. Housing prices have a side effect on the migrants’ willingness to permanently settle, and so is air pollution. The coefficients of the interaction of city size and housing price, the interaction of city size and air pollution, and the interaction of city size and health are significantly positive, indicating that with the expansion of city size, the crowding effect of high living cost, air pollution, and health deterioration is significant for rural-urban migrants.
The findings in this paper also have important implications for development policy. On the one hand, the natural environmental factors and individual health conditions play a key role in the settlement of migrants. The larger the city, the worse the health condition of migrants. Air pollution is also not conducive to immigrants settling in cities. In brief, our results suggest that migrants tend to settle in cities with good weather, that is, cities with low air pollution, less rainfall, and mild temperature. Besides, the urban integration between migrants and local people still needs to be improved. Our results indicate that the larger the city size, the role of the urban social network in promoting the permanent settlement of migrants is more obvious. Moreover, about 20% of migrants do not have any social activities in their spare time, which is not conducive to the mental health and the stable settlement of migrants in the city. Therefore, improving working and living conditions for migrants in urban areas may go a long way. According to the needs of the migrants, the local governments should provide more community activities or activities for promoting fellowship for migrants to help them integrate into the living city.
On the other hand, while most policymakers are concerned about improving the urban amenities, the fact that high-quality infrastructures are still insufficient for residents when considering the negative impact of road congestion on the settlement of rural-urban migrants. Many governments, especially those in mega-cities, consider that rural-urban migrants have undesirable effects on their communities of the destination city. There is still a strict access system for migrants to become new urban residents in mega-cities such as Beijing and Shanghai. In Shanghai and Beijing, education is the key factor in registered residence admission. However, by analyzing the settlement intention of high-skilled and low-skilled migrants in our paper, the urban integration of low-skilled immigrants cannot be ignored. In the future, the occupational evaluation should be more diversified in a large city, so that this index can be incorporated into the registered residence admittance system. However, it can be seen from the CMDS data that the average time of migrants living in the urban area has exceeded six years, and migrants who are willing to settle permanently have been living in the city for more than seven years. The supply of urban public services should be linked to the size of the urban population including migrants, not just based on the residents with local hukou.