Setting Up the Uniform Social Security System Under Huge Rural Labour Migration in China : A Quantitative Analysis Using a SICGE Model

Migrant workers have made substantial contributions to urban economic development in recent years, but have not been provided with access to a corresponding social security system. In particular, the issue of the transfer and continuation of their pension insurance between jurisdictions has not been resolved, resulting in a low participation rate of migrant workers in the current pension insurance scheme. In 2009, two new policies were proposed to safeguard their social security. However, our SICGE model policy simulations of these policies suggest that their ability to promote rural labour migration is limited at best due to differing contribution rates, the large income gap between provinces as well as other factors. Our results therefore suggest that complementary policies should be proposed as soon as possible