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Social Networks
journa l h om epage: www.elsev ier .com/ locate /socnet
ocial capital and economic integration of migrants in urban China
ao Lua,∗, Danching Ruanb, Gina Laib
Columbia University, United StatesHong Kong Baptist University, Hong Kong
a r t i c l e i n f o
eywords:ocial capitalncome inequality
igrationhina
a b s t r a c t
Based on data from a 2005 survey conducted in Shanghai, China, this research examines the role of socialcapital in income inequality between rural migrants and urbanites. We find strong income return onsocial capital, in particular on social capital from strong ties. We also observe a great disparity in socialcapital possession between rural migrants and urban local residents. Although social capital from strongties seems to be more important for rural migrants than for urbanites, local ties and high-status ties donot seem to benefit rural migrants. Hence, migrants not only suffer severe social capital deficits but alsocapital return deficits. Given the strong income returns on social capital and the substantial differences inaccess to and return on social capital between migrants and urban residents, social capital is consequentlyfound to explain a large part of the income inequality between the two groups. Overall, our findingsreveal macro-structural effects on the role of social capital in labor market stratification. In China, thelack of formal labor market mechanisms continues to create both a strong need for and opportunities foreconomic actions to be organized around informal channels via social relations. Yet, the long-standing
institutional exclusion of migrants caused by the household registration system has resulted in pervasivesocial exclusion and discrimination which have substantially limited rural migrants’ accumulation andmobilization of social capital. Under these conditions, social capital reinforces the economic inequalitybetween migrants and urban residents in China. Such empirical evidence adds to our understanding ofthe role of social capital in the economic integration of migrants and in shaping intergroup inequality ingeneral.
. Introduction
Previous research across many societies has documented anncome gap between immigrants and the native-born populationn the destination country (or the local population in the setting ofnternal migration). Two main approaches have been put forwardo explain the economic gap between immigrants and the natives.ne approach focuses on the individual characteristics and behav-
ors of workers and employers and attributes the gap to immigrants’ower human capital and the discriminatory practices of employ-rs (Friedberg, 2000; Démurger et al., 2009; Hall et al., 2010). Thenstitutional approach, in contrast, emphasizes the structural con-traints on the economic mobility of immigrants associated withabor market arrangements (e.g., labor market segmentation) andtate institutions (Constant and Massey, 2005; Fan, 2008).
However, these approaches have overlooked the role of socialapital in the labor market stratification. Social network scho-ars argue that the social resources embedded in social relations,
∗ Corresponding author at: Department of Sociology, Columbia University, 501nox Hall, New York, NY 10027, United States. Tel.: +1 212 854 5442.
referred to as social capital, have important implications for thestatus attainment and mobility process (Lin, 2001). Through socialconnections, individuals obtain valuable job information and areconnected to economic opportunities beyond their original repos-itory; social connections may also provide tangible assistance orexercise social influence to help individuals navigate the labormarket and overcome structural barriers (Bian, 1997; Granovetter,1995; Lin, 2001).
Research on the social networks and economic integration ofimmigrants has demonstrated the important role of social capi-tal in the employment and earnings of immigrants by improvingthe effectiveness of the job search process and providing crucialinformation about good jobs (Aguilera and Massey, 2003). This lineof research especially highlights the positive impact of co-ethnicnetworks in job searching and protecting immigrants from labormarket discrimination (Sanders et al., 2002). However, immigrants’overreliance on co-ethnic networks is sometimes thought to isolatethem from the resources available in the mainstream economy. Itis argued that economic integration might be better facilitated by
connections to natives, who can assist immigrants by providinga bridge to the mainstream labor market (Nee et al., 1994; Fongand Ooka, 2002). However, there is little empirical evidence onwhether, under conditions of stringent institutional barriers and
ocial discrimination, social capital, particularly that embedded inmmigrants’ social connections to the native population, wouldelp to narrow the economic gap between immigrants and natives.
This query echoes a recent call for research attention to be giveno the role of social networks in exacerbating or ameliorating socialnequality (DiMaggio and Garip, 2012). Inequality in social capitals linked to socioeconomic inequality through two mechanisms,amely differential access to social capital and differential returnsn social capital, both of which are argued to be influenced by bothndividual characteristics and structural factors (Lin, 2001). The first
echanism—social capital is unequally distributed among differentocial groups in a society—is well documented (Lin and Erickson,008); but the second mechanism receives much less attentionSmith, 2005). Overall, how social capital accounts for intergroupconomic inequality is not well understood.
The present study aims to examine these very questions bytudying rural migrants and local residents in Shanghai, the largestetropolis in China. The rapid economic growth in China since thearket reforms has generated a massive influx of rural-to-urbanigrants. In the meantime, the household registration system that
as been implemented since the late 1950s has segregated rural andrban Chinese into two different classes of citizens (Solinger, 1999).s a result, rural migrants are often marginalized in the urban laborarket and disproportionately engaged in low-pay and low-status
obs (Fan, 2008; Guo and Iredale, 2004; Wang et al., 2002). The wageap between rural migrants and local residents becomes even moreronounced when working time is taken into consideration (Xing,008). Rigid institutional constraints further lead to social discrimi-ation and residential segregation, thereby limiting rural migrants’pportunities to develop enduring social relationships with urbanesidents (Li, 2011; Situ and Liu, 1996).
With these institutional and social barriers as the background,e address several issues: What is the role of social capital in
conomic inequality between rural migrants and urban residents?ow can this economic inequality be understood in terms of theifferential access to and the different returns on social capital ofhe two groups? In particular for migrants, can social ties, bothhose with urban residents and with other migrants, help improvehe economic outcomes of migrants, thereby narrowing the gapetween migrants and local residents? Through examining eco-omic inequality between locals and migrants with the socialapital lens, we hope to add to the literature on the economic inte-ration of migrants in the host society. Furthermore, we hope todd to the inequality literature by moving beyond the individual-ersus-structural dichotomy of explanations and instead, directingur attention to the joint forces of individual characteristics (e.g.,ersonal attributes), institutional factors (e.g., household registra-ion system), and social network features (e.g., social capital) in theeproduction of social inequality.
. Social capital and labor market inequality
Traditional explanations of labor market inequalities are mainlyased on individual attributes, in particular human capital (Mincer,974). This view is contested by the dual labor market perspective,hich emphasizes the importance of structural obstacles in inhibi-
ing the disadvantaged from obtaining complete market privilegesPiore, 1979). Nevertheless, explaining economic inequality as aunction of human capital and job structures often leaves much ofhe gap unexplained. A growing strand of research has attemptedo explain the remaining gap in terms of social capital.
Two conceptualization approaches have been proposed for
nderstanding social capital. Coleman (1988) and Putnam (1993)onceptualize social capital as the emergent properties of socialetworks—such as trust and reciprocity—that provide the socialontrol and solidarity that facilitate “coordinated actions” and the
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pursuit of “shared objectives” and thus enhance collective well-being. Another perspective, proposed by Lin and associates (1982,2001), conceptualizes social capital as the resources instrumen-tal for social actions, such as information and influence, that aredirectly or indirectly accessed through interpersonal ties. The dis-tribution of resources is depicted as a hierarchical structure. Interms of social ties, people in high-ranking positions (upper reach-ability) are likely to command better resources for instrumentalactions than those in the lower ranks. Access to social connectionsin diverse positions (network extensity) increases the variety ofavailable resources, and this enables an individual to penetrate dif-ferent social networks beyond his or her immediate social milieu.Social connections to people in positions that span the hierarchicalstructure, which reflect the richness of a person’s resources (net-work range), facilitate the attainment of higher status jobs. Weadopt Lin’s conceptualization because our focus is on the hierar-chical structure of social ties.
Social capital has been found to be consequential for labormarket outcomes. Studies on job seekers find that social contactsprovide useful job information and exert influence on employmentdecisions, thus enhancing job search outcomes (Lin and Erickson,2008). Also, employers prefer to hire those referred to them byhigh-status people because they are considered to be more reliableand because they may bring useful resources with them (Erickson,2003). In short, people rich in social capital may have a better jobto begin with. Their social capital may give them a further advan-tage in promotions and pay rises. Social networks are also found tofacilitate self-employment through the provision of material sup-port, market information, and referrals to further resources. Theseresources help entrepreneurs to identify business opportunities,foster new ideas, reduce uncertainty, and minimize the cost of self-employment (Allen, 2000).
Research suggests that the value of social resources depends onthe strength of the relationship. Strong ties, such as ties with familyand close friends, imply trust and obligation and thus may providethe reliable information and strong influence needed in the labormarket (Bian, 1997). Weak ties, such as ties with acquaintances, canserve as bridges that link individuals to diverse social circles andgive them access to nonredundant information and other valuedresources not present in their own social circle (Granovetter, 1995;Lin, 2001; Burt, 2001).
However, as with almost any other resources in a society, socialcapital tends to be unequally distributed by virtue of social class,race and ethnicity, gender, and other attributes (social capitaldeficit; Lin and Erickson, 2008). This is partly due to macrostruc-tural constructions that provide unequal contact opportunities tomembers of different groups and is also reinforced by the principleof homophily, the general tendency of people to form networkswith members from their own social group (McPherson et al.,2001). Therefore, whereas high-status individuals are likely to havenetworks that are large and diverse and composed of high-statuspeople, low-status individuals are often found in small, homoge-neous networks with low-status people. Take the U.S. for example:ethnic minorities and the underclass lack regular and sustainedcontact with individuals who have strong attachments to main-stream institutions, and this has given rise to their undesirable labormarket position (Wilson, 1987; McDonald et al., 2009).
Besides their social capital deficit, people in disadvantagedgroups may also face a social capital return deficit: that is, agiven quantity of social capital may generate differential returnsas network mobilization strategies, agent efforts, and institutionalresponses differ for different social groups (Lin, 2001). An example
is the disadvantages of Blacks in the U.S. labor market, which are notonly attributed to deficiencies in access to social capital but also todeficiencies in their networks (Smith, 2005). Blacks are more likelyto have access to networks characterized by pervasive distrust and
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reat reluctance in providing assistance and information, and thisesults in a limited flow of network resources.
Despite the extensive research on the social capital effect onabor market outcomes, its impact on intergroup inequality is not
ell understood. DiMaggio and Garip (2012) propose that socialetworks reduce intergroup inequality when the flow of assistanceccurs between “status-dissimilar individuals” (e.g., between high-tatus and low-status individuals), especially in situations whereabor markets are less institutionalized and social discriminations tolerated. Furthermore, when members of a social group areeemed to be outsiders in a social system (e.g., immigrants), socialonnections to people with high institutional legitimacy (e.g., insid-rs of a social system or mainstream social groups) are particularlymportant (Burt, 1998; Kanas et al., 2011). Access to and return onocial capital constitute important mechanisms in the reduction oreproduction of social inequality.
.1. Social capital and immigrants’ labor market integration
With respect to immigration, not only do social networks influ-nce migration decisions (Massey and Espinosa, 1997), they are alsoelated to migratory outcomes such as settlement patterns, assim-lation, and transnational links (Durand et al., 1996). As for labor
arket outcomes, immigrants’ employment and earnings remainontingent on their social capital even after accounting for a wideange of demographic and socioeconomic factors. Social capitalas a positive effect on immigrants’ occupations and earnings by
mproving the effectiveness of the job search process to yield formalector and high-paying jobs (Aguilera and Massey, 2003; Amuedo-orantes and Mundra, 2007). For example, relatives and friendsan provide useful job information to migrants and information onnterview preparations and wage negotiations. Social ties may alsoelp channel immigrants into jobs with higher wages and betterorking conditions, such as those in the formal sector. In compar-
son to documented migrants, undocumented immigrants tend toely more on social capital because they are structurally blockedrom many labor market resources (Aguilera and Massey, 2003).
Because of their marginality in the mainstream labor mar-et, immigrants often pursue alternative opportunities for upwardobility through self-employment (Nee et al., 1994). One pivotal
lement for entrepreneurship is social capital, which helps thestablishment and operation of businesses by providing commer-ial information, administrative assistance, and reliable partnersor business practices. These processes evolve into ethnic socialnstitutions in which reliance on social solidarity within the eth-ic networks enables immigrant entrepreneurs to dominate certainiches and to gain competitive advantages in the broader economyWaldinger, 1994).
Immigrants’ social networks are often mostly composed of co-thnic immigrants. It is argued that such overreliance on co-ethnicetworks increases social exclusion and lack of acceptance; that
s to say, if immigrants confine themselves to a predominantly co-thnic social network, this will reduce their chances of participatingn the mainstream economy and in social activities in the widerociety and thus limit their potential for upward mobility (Neet al., 1994; Fong and Ooka, 2002). However, very few studies havepecifically examined the relative importance of the social capitalmbedded in connections to other immigrants and that embeddedn connections to natives for immigrants’ economic integration.
. The Chinese setting
The present study seeks to fill this gap in the literature by exam-ning the role of social capital in intergroup inequality between
igrants and the native population in the Chinese context. To
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provide background information about the research site, below,we review studies on the role of social capital in the labor marketprocess in China and the labor market experience of Chinese ruralmigrants.
3.1. Social capital and the labor market process
The major structural carrier of social capital in China is guanxi.Guanxi is defined as “a dyadic, particular and sentimental tie thathas the potential of facilitating favor exchanges between the partiesconnected by the tie” (Bian, 2006, p. 312). Guanxi connects twoindividuals with strong obligations toward each other. The basis ofthese obligations can be cultural norms (e.g., kinship ties), affection,or repeated favor exchanges.
Guanxi has played an extremely important role in the social andeconomic life in China. Before the market reforms, the labor marketwas hierarchically controlled by the state and jobs were assigned byauthorities. In order to get a good job, a person needed to mobilizesocial networks to influence the job-assigning authorities. Directinfluence through strong ties was thus more critical than informa-tion channeled through weak ties (Bian, 1997). This explains why,unlike in western societies, strong ties are mobilized more oftenthan weak ties.
In the face of deepening market reforms, some scholars havequestioned the importance of guanxi. As formal economic struc-tures become more routinized, economic practices tend to becomemore rationalized and people are increasingly free to explore eco-nomic opportunities. Some have argued that this trend results ina diminishing reliance on guanxi (Guthrie, 2002). However, othersmaintain that the significance of guanxi has not declined and mayhave even increased under the market reforms. This argument iscorroborated by empirical research. For example, Bian and Huang(2009) show that more than 10 years after the market reformsbegan in 1978, still 75% of job changers used personal connectionsto facilitate their job change and those who used guanxi were morelikely to move into higher-paid jobs. The persistence of guanxi isargued to be due to China’s under-developed labor markets, whichare marked by institutional holes and great uncertainties. Formalmechanisms are either not readily available or ineffective. Peoplehave thus continued to rely on personal connections to get thingsdone. Also, as market competition has intensified, people tend tomore heavily resort to guanxi in order to gain the edge in the com-petition (Bian and Huang, 2009). Several studies have found furtherevidence that not only job seekers but also employers remain moti-vated to use guanxi (Knight and Yueh, 2008). The explanationsinclude the inefficient mechanisms for verifying the qualifica-tions of a potential employee and, perhaps more importantly, theexpected benefits to be gained from favor exchanges. Furthermore,some scholars have argued that guanxi carries greater importancefor the self-employed than for the wage earners given the highuncertainty in the Chinese business environment, especially in theareas of property rights, credit allocation, and legal regulations ofbusiness operations (Yueh, 2009). To overcome these institutionalconstraints, social networks, particularly personal connections topeople in key positions in the political and market institutions, haveto be mobilized to obtain business resources such as startup capital,business licenses, access to reliable suppliers and distributors, andfinancial credits (Fong and Chen, 2007; Yueh, 2009).
3.2. Migrants in Chinese cities
Since the early 1980s, hundreds of millions of rural migrants
have left their homes for the better economic opportunities inurban areas. The flow of rural migrants has skyrocketed from about30 million in 1989, to 80 million in 2001, and to 230 million in 2011(National Population and Family Planning Commission of China,
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012). Nationwide, rural migrants account for 20% of the urbanorking population (Xing, 2008). More than 80% of rural migrantsave some family members in the city where they work and about0% migrated to the cities with their entire nuclear family (Li,008).
Profound social and economic segregation has been observedetween rural migrants and urban residents. Migrants are dispro-ortionately engaged in undesirable and poorly paid jobs that arehunned by urban residents, such as construction and service jobsYang and Guo, 1996). They are also formally excluded from manyobs, especially those in the state sector that provide income secu-ity and good benefits (Meng and Zhang, 2001). Although theirarnings are much higher than what they would earn from farmork, the wages of rural migrants are 80% of what urban residents
arn. To compensate for their low wages, migrants work extremelyong hours (58 h per week compared with 43 h for local urban work-rs; Meng et al., 2010). Thus, the hourly wages of rural migrants areust 64% of what urban residents earn, when we take the workingime into consideration (Xing, 2008).
A clear residential segregation between migrants and local resi-ents has been observed, with rural migrant families often living
n rental housing in the neighborhoods where migrants congre-ate (Chen et al., 2011). Some migrants live in cramped temporaryousing such as dormitories and shelters on construction work-ites (Chen et al., 2011). Furthermore, until some recent (but slow)hanges, migrants have been denied access to urban welfare provi-ions such as subsidized housing, healthcare, unemployment andension benefits, and education for their children (Meng et al.,010).
The fundamental reason behind migrants’ second-class citizentatus is the hukou system, instituted since 1958 to create a dualconomy to facilitate industrialization in urban areas. Under thisystem, a person is given either an “agricultural” or “nonagricul-ural” hukou status at birth and geographical mobility was severelyestricted. Although restrictions on rural-to-urban migration haveeen relaxed since the economic reforms and nowadays many ruraligrants work in cities, it is still extremely difficult, if not impos-
ible, for rural migrants to change their rural hukou status to anrban one (Solinger, 1999). Without an urban local hukou status,ural migrants encounter numerous structural constraints in theabor market and in gaining access to welfare (Wang et al., 2002).
In addition to the institutionalized discrimination, migrants faceervasive social prejudice and discrimination from urban residents.esidential and occupational segregation limit the opportunities
or rural migrants to make friends with local people. Rural migrantsre often negatively stereotyped as being poor, dirty, ignorant, androne to violence (Solinger, 1999). They are frequently blamedor the increasing crime rates and social instability in the cities,nd many were subjected to random identification checks on thetreets until recently (Whyte, 2010). In many respects, the life cir-umstances of rural migrants bear a great resemblance to those ofllegal immigrants in industrialized societies (Roberts, 1997). Thecceleration of market reforms since the mid-1990s has furtherntensified the tension between rural migrants and urban residents.s a result of substantial economic restructuring, a large numberf state-owned enterprises were shut down, restructured, or priva-ized. Millions of urban workers were laid off, and some of them hado compete with migrants for jobs in the private sector, leading toncreased competition between the two segments of the populationGarnaut et al., 2005).
Living under these structural and social environments, manyural migrants exploit entrepreneurial opportunities to achieve a
esirable livelihood, with over one quarter of rural migrants beingelf-employed (Davis, 1999; Giulietti et al., 2011). The majority ofhese migrants are small-scale business owners with fewer thanight employees. However, self-employed migrants also face strong
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structural obstacles given their marginalized outsider status incities and restricted access to instrumental social resources.
The central government has made some recent efforts toimprove the living and working conditions of migrants. For exam-ple, in 2008, the New Labor Law was implemented to protect therights of migrant workers. Various attempts have also been madeto reform the hukou system (Chan, 2009). The success of thesemeasures, however, is limited, and the hukou system has remainedlargely intact (Chan and Buckingham, 2008).
4. Research questions
Little work has been conducted on the relationship betweensocial capital and the migrant-local economic gap in China. Theexisting work has focused on the role of social networks in enhanc-ing the propensity to migrate and is largely based on data gatheredbefore 2000 (Zhao, 2003). Using data from a survey conductedin 2005, the present study seeks to examine this relationship byanswering the following questions.
First, we expect to find large disparities in the quantity and qual-ity of social capital between migrants and urbanites, with migrantslacking extensive and influential social connections. Second, westudy whether there is a positive income return on social capital formigrants and locals in a transitional China marked by rising insti-tutional uncertainties and market competitiveness. For the samereason, we examine whether strong ties play a more importantrole in achieving better labor market outcomes than weak ties andwhether this is especially evident in the case of migrants, who areexcluded from many formal institutions in urban areas.
In addition, we study whether migrants garner greater benefitsfrom ties with urbanites and people in high-status positions by test-ing the following two competing hypotheses. On the one hand, onemay expect additional benefits to be gained from local and high-status connections. Establishing connections with the mainstreampopulation can benefit migrants because these ties are more pow-erful and resourceful than ties with other migrants or low-statuspeople. Information and assistance from migrants and low-statuspeople is likely to lead to low-paid and low-status jobs since thesepeople are more likely to occupy such jobs and less likely to exertinfluence on employers.
On the other hand, rural migrants may receive limited returnsfrom their ties to urbanites and high-status people given the sub-stantial institutional and social discrimination against migrants.Migrants’ ties with urbanites may be characterized by prejudicesand a reluctance to assist, leading urbanites to have doubts aboutthe competence of migrants and what migrants have to offer inreturn or to worry about the damage done to their own reputationby helping migrants.
If social capital is positively related to income and if there isinequality between migrants and urbanites in terms of access toand return on social capital, social capital is expected to explaina large part of the income inequality between the two groups. Weexpect that the income gap between these two social groups wouldbe reduced when social capital is taken into account.
5. Data and methods
5.1. Data
Shanghai is a suitable location for the purpose of this study.Located on the central eastern coast, Shanghai is the largest city inChina, with a population of over 20 million. It is an important eco-
nomic center with large state enterprises and a booming privatesector. Shanghai is also one of the major migration destinationsin China. In the past few decades, the number of migrants hasrisen substantially, from 0.26 million in 1981 to nearly 5 million
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y 2007, accounting for more than one quarter of the city’s popu-ation. Today, two out of every five employed laborers in Shanghaire migrants (Ruan, 2009).
Shanghai is also a setting where rich data on migration andocial capital are available. We used data from a survey conductedn Shanghai in 2005 that incorporated detailed information onabor market experiences and social capital for both locals and
igrants. The survey, developed and administered by researchersrom Shanghai and Hong Kong, adopted a stratified multistage clus-er sampling strategy. We sampled people who were aged 16–60the typical working age range in China) at the time of interview. Weelected 7 out of the 18 city districts to represent the inner city (cityenter), the outer city (new districts and suburbs), and the districtsn between (central ring). Using the probability of 8 per 10,000 andollowing the procedure of probability proportional to size (PPS),6 neighborhood committees (juweihui) were chosen. Within eachelected neighborhood committee, around 50 local resident house-olds were randomly selected, resulting in a targeted sample sizef 2012. Within each selected household, the Kish table was usedo select the respondent (aged 16–60) to be interviewed face-to-ace. Out of the 2012 interviews attempted, 1835 were completed,ielding a response rate of 91.2%.
The sampling of the migrant population followed a similarPS procedure within the selected neighborhoods. Migrants wereefined as adults aged 16 and above who had stayed in Shanghai forver a month for work purposes (other than travel, short-term workssignments, hospital visits, family visits, and education-relatedtays). Based on a 2003 survey of the migrant population conductedy the Shanghai city government and our targeted migrant sampleize of 2800, we used a probability of 5.2%. In 29 of the 36 neigh-orhood committees selected, both local residents and migrantsere interviewed. In addition, local residents and migrants were
eparately interviewed in 14 different neighborhoods. If factoriesr other collective dwelling units (e.g., dormitories, where manyigrants reside) were within the neighborhood, they were also
ncluded in the sampling frame. Out of the 2974 migrant inter-iews attempted, 2816, or 94.72%, were successful. We comparedhe distributional data from this survey to the data from the 2000ensus and other regional studies conducted in early 2000s. Theomparisons yielded consistent patterns.
It should be acknowledged that because this study was limitedeographically to Shanghai, its implications in terms of providing aeneral understanding of the Chinese urban labor market shouldot be overstated. Nevertheless, Shanghai is a major migrationestination with considerable market opportunities and relativelypen policies toward migrants (Qian and Li, 2010). As discussedelow, the fact that we still observed social capital deficits andeturn deficits for migrants suggests that these findings are likelyo apply to many other parts of China.
.2. Measures and methods
The labor market outcome we examined is income. Informationn monthly income was collected directly from survey respon-ents and measured by average monthly cash income, includingages, bonuses, and subsidies. For the self-employed, information
n net income rather than gross income was collected. We focusedn monthly income, which is a more accurate measure in Chinaecause many workers, especially migrants, are not paid an hourlyate but by piecework (Solinger, 1999).
One main explanatory variable is migration status, which dis-inguishes urbanites (those with local Shanghai hukou) and rural
igrants (those with nonlocal rural hukou). As for social capital,e used the position generator method to measure an individual’s
inks to various social locations (Lin and Dumin, 1986). The posi-ion generator method is a useful way of gauging the structural
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dimensions of an individual’s networks in terms of positionalextensity, status ceiling, and class composition. This methodologyinvolves presenting the respondent with a variety of occupationalpositions at various status levels. The respondent is then askedwhether any of his or her relatives, friends, or acquaintances holdsuch positions. Usually, three indexes are generated: (1) exten-sity: the number of occupations a respondent could access, whichrepresents the size and diversity of his or her network; (2) upperreachability: the highest occupational prestige score among theaccessed occupations; and (3) range: the difference between thehighest and lowest accessed occupational prestige scores. The posi-tion generator methodology has been shown to be a reliable andvalid measure of social capital (Lin and Erickson, 2008). Comparedto other methods such as the name generator method, it is lessbiased toward strong ties, although it makes little reference to spe-cific events.
The position generator method has been proven to be a usefulnetwork device in Chinese society (Lin and Erickson, 2008). Thecritical consideration is the choice of occupations, which shouldrepresent occupations with prestige levels from the very high to thevery low. We used position generator items that have been adaptedto the Chinese setting (Bian, 2008). We selected 18 items (18 occu-pations) from the classification of over 500 three-digit coded jobtitles used in the Chinese census. These occupations cover a widerange of jobs with varying levels of occupational prestige (scientist,college professor, legal staff, engineer, physician, government offi-cial, school teacher, manager, business professional, clerk, police,nurse, chauffeur, chef, industrial worker, salesperson, waiter, anddomestic worker).
Based on these occupations, we created three summary indices:extensity, upper reachability, and range. Because these indicesare highly correlated, we followed earlier work in using factoranalysis (with principle component and varimax rotation) to sum-marize these dimensions. As expected, this analysis yielded asingle-factor solution. We then constructed a factor score as a com-posite social capital measure and rescaled it to between 0 and1 to facilitate interpretation. As an additional analysis, we alsoevaluated the separate roles of network extensity and the aver-age prestige of the accessed networks (Campbell et al., 1986) toassess whether diverse networks and high-prestige networks havea greater influence in the labor market. Importantly, because theposition generator questions are specific about whether the con-nection is with relatives, friends, or acquaintances, we constructedseparate measures that distinguish strong social ties (relatives andfriends) and weak social ties (acquaintances). In the survey, wealso asked whether the ties in each occupation category involvedlocal urban residents. This allowed us to create a measure ofsocial capital with urbanites, which we refer to as local socialties.
To examine the net effects of social capital, we adjusted forthe differences between migrants and urbanites in terms of bothdemographic traits, such as age, gender, and marital status, andproductivity-related characteristics, including level of education,whether a respondent received job training, and work expe-rience (years in present job). The inclusion of these variablesfollows the human capital model proposed by Mincer (1974).To take account of the Chinese context, we included an indica-tor of political capital: Communist Party membership. We alsoaddressed the issue of occupational segmentation by controllingfor respondents’ occupations and placement in different ownershipsectors. We differentiated four occupational categories: profes-sional/managerial/clerical, commerce, service, and manual. We
also distinguished between three ownership sectors/types: state-owned, nonstate-owned, and individual-owned (self-employed).We did not separate domestic and foreign private enterprises dueto lack of information.
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a Means are shown for continuous variables. For all other categorical variables,
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We used ordinary least squares (OLS) regressions with log trans-ormed monthly income as the dependent variable, controlling forhe rich set of variables discussed above. The regression coefficientsan be read as the percentage change in income with changes in theovariates. The analytic sample consisted of respondents employedr self-employed at the time of the survey. The analyses wereeighted to represent the local and the migrant population in 2005.e first performed a sequence of regressions with and without the
ocial capital measure to study its overall impact on income and itsmportance in explaining the income inequality between migrantsnd urbanites. We then estimated separate models for migrantsnd urbanities and compared the estimates to study the relativeole of social capital for each group. In these stratified analyses, weeached our conclusions by conducting statistical tests of the dif-erences. As an additional analysis, we performed Blinder–Oaxacaecomposition, which allowed us to determine the amount of theigrant-local difference in terms of income associated with social
apital deficits and capital return deficits. The procedure and resultsre discussed in detail below. In the analytic sample, the amount ofissing data was relatively small. The analysis was based on com-
lete cases after deleting less than 5% of the cases with any missingata.
Since the data were cross-sectional, endogeneity may be anssue. We were unable to definitively pin down whether (a) socialapital helps an individual to achieve higher income, (b) higher eco-omic status offers an individual better opportunities to enrich hisr her networks, or (c) the homophily principle leads to both higherncome and more resourceful networks, as suggested by empiri-al evidence from the U.S. (Mouw, 2006). Yet, in a recent study,hen (2012) shows that social capital has some genuine effect on
abor market outcomes after adjusting for endogeneity. Given thenavailability of appropriate data to verify the causal effect of socialapital, we adjusted for a rich array of factors that may be related tohe production of social capital. We also conducted sensitivity anal-ses using information on respondent’s length of migration sincendogeneity may be less problematic for more recent migrants.his analysis yielded consistent findings and increased our confi-ence that the results were not entirely driven by endogeneity. Ourbservation of a significant association between social capital andncome inequality between rural migrants and urban residents pro-ides an empirical ground for the verification of the causal effect inuture research.
. Results
.1. Descriptive statistics
Table 1 shows the substantial differences between urbanesidents and rural migrants in terms of demographic and socio-conomic characteristics. Migrants are, on average, younger, lessducated, less likely to be party members, and largely concentratedn nonprofessional occupations and nonstate sectors. In Shanghai,ess than 7% of migrants are employed in the state-owned sec-or compared to almost 43% of local Shanghainese. This reflectshe persistence of the hukou system that denies the majority of
igrants access to the state sector. As a result of the restruc-uring of state-owned enterprises since the mid-1990s, a largeumber of urbanites have entered the private economic sector,
eading to increasing competition between the two populations.he economic reforms have also clearly generated considerableelf-employment opportunities, which have been taken up by many
igrants. We can see that the percentage of migrants who are self-
mployed is more than seven times greater than the correspondinggure for urbanites. With respect to income, there is an unam-iguous income gap, with local residents earning almost 18% more
percentages are presented.* Difference by migration status is significant at the 0.001 level.
per month than migrants. All of the local-migrant differences aresignificant at the 0.001 level.
6.2. Differential access to social capital between rural migrantsand local residents
Turning to the measures of social capital, the top panel of Table 2reports the 18 occupations, the corresponding prestige score, andthe proportion of respondents with connections to each occupa-tional category. Except for ties with industrial workers, there aresubstantial disparities in the structure of social networks betweenurbanites and migrants. Migrants seem to have limited access tomedium and high prestige occupations but are more likely to knowsomeone in occupations concentrated at the lower end of the hier-archy.
The summary indices in Table 2 confirm our expectationregarding migrants’ capital deficits. The social capital of migrantsis much less in terms of extensity (diversity) and has a much lowerstatus than the social capital of urbanites. This finding held when wedistinguished local social capital (social capital with urbanites) andsocial capital from strong ties (relatives and friends). Migrants aremuch less likely to establish social ties with local urban residents,and the mean prestige of local social capital is significantly lower formigrants than it is for urbanites. This means that even if migrantshave ties to local people, those locals tend to have a relatively lowstatus. The only aspect for which the difference by migration statusis negligible is social capital from weak ties (acquaintances).
The factor scores at the bottom of Table 2 can be seen as asummary of the above findings. With respect to general socialcapital, the local-migrant ratio is 1.64 (0.64/0.39). This is largelydriven by the substantial disparity in social ties with local peo-ple, with a local-migrant ratio of almost 3 (0.53/0.18). These resultsclearly demonstrate the strong social segregation encountered bymigrants which renders them less likely to establish social ties withlocal people and people of high status. To evaluate whether the
results are due to migrants’ shorter length of stay in the city, wecarried out an additional analysis to examine the network struc-tures between urbanites and long-term migrants (those who have
Y. Lu et al. / Social Networks 35 (2013) 357– 369 363
Table 2Position generator and differential access to social capital, 2005, Shanghai.
Position (prestige score) Total (N = 3070) Urban residents (N = 1196) Rural migrants (N = 1874)
Mean prestigeMean (S.D.) 32.4 (25.2) 44.9 (23.8) 21.5 (20.2)***
General social capital (weak ties)Extensity
Mean (S.D.) 1.4 (2.0) 1.5 (2.5) 1.4 (1.7)Range
Mean (S.D.) 15.8 (26.2) 16.5 (27.6) 16.0 (25.7)Upper reachability
Mean (S.D.) 30.7 (35.9) 32.1 (38.6) 30.3 (34.1)Mean prestige
Mean (S.D.) 21.9 (27.0) 22.7 (29.2) 21.5 (24.6)
Factor scores (range 0–1)General social capital 0.49 (0.31) 0.64 (0.26) 0.39 (0.30)***
Local social capital 0.31 (0.34) 0.53 (0.33) 0.18 (0.27)***
General social capital (strong ties) 0.35 (0.32) 0.55 (0.30) 0.22 (0.26)***
General social capital (weak ties) 0.24 (0.30) 0.25 (0.32) 0.24 (0.29)
Note: Difference by migrant status is indicated as follows:
lr
sAe
* p value < 0.05.*** p value < 0.001.
ived in Shanghai for over five years). The gap slightly decreases butemains substantial and statistically significant.
We also studied the relationship between social capital pos-ession and migrant status in a regression framework (Appendix). Migration status clearly matters. In fact, it has the largestffect on an individual’s social resources even after other crucial
determinants, such as human capital and political capital, are con-trolled for. These results are in agreement with earlier work in
other societies that indicate that individuals with high socioeco-nomic status are likely to be embedded in networks that are larger,more diverse, and more influential than those of low-status indi-viduals. With regard to the social capital gap between migrants
364 Y. Lu et al. / Social Networks 35 (2013) 357– 369
Table 3OLS regressions of monthly income (log), 2005, Shanghai (N = 3070; test statistics in parentheses).
nd locals, the local social capital gap is almost double the generalocial capital gap. We also separated the analysis by urbanites andigrants (general social capital), and for migrants, we included an
dditional variable of whether the respondents speak the Shanghaiialect. There are some variations by migration status. Languagend education are more important predictors of migrants’ socialapital than of locals’ social capital. For both groups, occupa-
ion and political capital play a crucial role in building socialelationships.1
1 We also included the language variable in the income regressions. It does notignificantly predict income or change the overall results and is thus not includedn the final income regressions.
6.3. Social capital and income inequality between rural migrantsand local residents
Table 3 presents the results from the income regression. InModel 1, we see that age, gender, marital status, education, andwork experience all play a crucial role in income attainment, whichis consistent with previous studies. There are also substantial dif-ferences by occupational status: people holding professional andclerical jobs earn much higher incomes than those in commerce,service, and manual jobs. With respect to economic sectors, the self-employed appear to earn more than wage earners. After controlling
for differences in human capital, political capital, and sorting intodifferent occupational categories, migrants still earn almost 9% lessthan urbanites. This finding points to the enduring income inequal-ity facing migrants.
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However, when social capital is taken into account (Models 2–5),he income gap is greatly reduced (by at least 40%) and becomesnsignificant. These findings confirm our expectation of social cap-tal’s role in explaining income inequality. Several reasons mayccount for the disappearance of the income gap between the tworoups after controlling for social capital. One is the unequal accesso social capital between migrants and urbanites, as shown inable 2. Another reason is the positive relationship between socialapital and economic returns, which is clearly revealed in Table 3.ake Model 2 for example: net of many other factors, individualsith the highest level of general social capital are expected to earn
lmost 24% more than those with the lowest level of social capital. similar finding is demonstrated in Model 3, but the coefficient isalved because the range of this measure is smaller—it only cap-ures connections with local people. Moreover, we find that socialapital from strong ties, not weak ties, matters (Model 4). In otherords, the strong relationship between social capital and incomee observed is largely driven by a close and trusted circle of rela-
ives and friends. This is consistent with previous research showing continuing reliance on informal channels through strong ties inoday’s Chinese labor market (Bian and Huang, 2009).
We also assessed the respective roles of network extensitymeasured by the number of occupations one is connected tohrough relatives, friends, or acquaintances) and prestige (degreef connection to high-status people) in Model 5 and concluded thatoth seem to matter in urban China. The extensity of networks has
mportant economic payoffs, with an increase in extensity raisingonthly income by over 2%. The scale of the coefficient for this
xtensity measure is different from that of the other social capitaleasures in Models 2–4, which are based on factor scores ranging
rom 0 to 1. Having connections with someone in a high-prestigeccupation also garners a greater amount of economic benefits. A0-point increase in average network occupational prestige score
s associated with a 2% increase in income. This is what we wouldxpect because ties located higher in the occupational hierarchyre more likely to be resourceful and influential.2, 3
A third reason for the ability of social capital to explain the
ncome gap may be related to social capital return deficits. Tur-ing to Table 4, we notice some differences in the relative rolef social capital for rural migrants and urbanites. With respect to
2 We focus on the comparison between urbanities and rural migrants becausehey present the most marked contrast. Urban-origin migrants constitute a muchmaller group. Compared to rural migrants, urban migrants are better educated, tendo have better jobs (many migrate due to job assignment), and face less discrimina-ion. We conducted corresponding analyses comparing urban migrants with localesidents. The results show that social capital plays an important role in the earningsrocess; however, there is no significant income gap between urban migrants andrbanities to begin with.3 To examine the variations in the explanatory power of social capital for theigrant-local income disparity, we estimated a series of models for each of the
our educational levels. In these models, we examine how much of the migrant-ocal difference in income is explained by general social capital. The proportionsre, respectively, 48% for those with lower than middle school education, 76% forhose with middle school education, 32% for those with high school education, andnly 4% for those with at least some college education. These results suggest that thexplanatory power of social capital decreases with education starting at the middle-chool level. It becomes very small for those with at least some college education.his might be related to our finding that it is social capital embedded in strong ties,ot weak ties, that is making a difference in income attainment. The strong ties ofigrants are likely to be ties to other migrants. As most of the migrants have a low
ducation (Table 1, only 11% have a high school education) and are located in theower strata of the labor market, migrants with better education should get veryimited help from fellow migrants who are worse off than themselves. Further, theind of jobs obtained by migrants with better education may be very different fromhat by migrants with less education and thus, the effectiveness of social capitaln income attainment may also be different. However, due to the small number of
igrants with some college education (0.8% or 15 people), our findings should beaken with caution.
s 35 (2013) 357– 369 365
general social capital, there is little difference between the twogroups (Model 1), which demonstrates the general importance ofsocial capital in urban China. But, the roles of strong ties (Model3) and the extensity of ties (Model 4) are significantly strongerfor migrants than for urban residents. This is consistent with theimmigration literature, which finds that social capital is particu-larly crucial for disadvantaged social groups (e.g., undocumentedimmigrants) because they are structurally excluded from a widevariety of formal mechanisms in the labor market. The return onlocal social capital, however, is smaller and only marginally signifi-cant for migrants (Model 2). This result provides some evidence thatmigrants face capital return deficits.4 Model 4 similarly shows thathaving high-status social connections, as measured by mean pres-tige, matters for urbanites but not for migrants. This difference ishighly significant between the two groups. These findings suggestthat having ties to locals or to high-status people (who are morelikely to be locals) does not guarantee the effective mobilization ofsuch ties. This may be partly due to the pervasive social discrim-ination experienced by rural migrants, which further shapes therelationship between migrants and local residents. Local residentsor high-status people may not be willing to assist rural migrantsbecause they may consider migrants to be less trustful or com-petent and may be concerned about their own reputation whenhelping migrants.
We conducted an additional analysis and found pervasiveprejudices toward migrants, even among locals who have exten-sive ties with migrants. This helps to explain the capital returndeficits facing migrants. Specifically, we used nine statements thatasked about attitudes toward migrants (e.g., “Migrants shouldhave equal employment opportunities to locals” and “The largenumber of migrants substantially intensifies the pressures in thelabor market”). We converted the response categories so that thatthe response to each statement ranged from 1 (strongly againstmigrants) to 5 (strongly supportive of migrants), with 3 being aneutral response to the statement, and summed up all nine state-ments. We compared the mean score by ties with migrants amonglocal urban residents, measured by a dichotomous indicator ofwhether the local resident’s mean prestige of ties is below or above50 (below 50 indicates close ties with migrants as most occupa-tions with a prestige score under 50 are predominately occupiedby migrants5). The expectation was that locals who have extensiveties with migrants tend to hold more favorable attitudes towardthem. This, however, is not the case. The attitude score is not sig-nificantly different for locals with extensive ties with migrants andthose with limited ties with migrants (30.9 vs. 30.6, respectively).While inter-group interactions would supposedly reduce prejudiceand discrimination, this is not the case for the relationship betweenrural migrants and urban residents in China. The social relation-ships of urban residents with rural migrants do not induce a morepositive attitude among the former toward the latter. This suggeststhat urban residents tend to hold generally biased views about ruralmigrants.
Another explanation for migrants’ capital return deficit with
respect to local ties may be attributable to the fact that the meanprestige of local social capital is significantly lower for migrantsthan for urbanites (Table 2). This implies that the local contacts of
4 We conducted a similar analysis for urban-origin migrants and found that theydo not seem to face social capital return deficits. For local social capital, the coeffi-cient is large and significant for urban migrants ( = 0.248; s.e. = 0.086), even moreso than that for locals. For mean prestige of social capital, the coefficient is alsolarge and significant ( = 0.002; s.e. = 0.001). Together with footnote 2, these find-ings strengthen our argument that the local-migrant inequality mainly lies in thestructural constraints inflicted by the rural–urban divide.
5 We did not have other information that allowed us to separate ties withmigrants.
366 Y. Lu et al. / Social Networks 35 (2013) 357– 369
Table 4The role of social capital for monthly income (log) by migration status, 2005, Shanghai.
Model 1 Model 2 Model 3 Model 4
Urbanresidents
Ruralmigrants
Urbanresidents
Ruralmigrants
Urbanresidents
Ruralmigrants
Urbanresidents
Ruralmigrants
General social capital 0.242*** ,a 0.230***
(4.498) (5.793)Local social capital 0.123**,b 0.088+
(2.921) (1.911)General social capital (strong ties) 0.269*** ,b 0.324***
(5.762) (6.163)General social capital (weak ties) 0.025a 0.074
(0.593) (1.840)General social capital (extensity) 0.019*** ,c 0.040***
(4.723) (6.187)General social capital (mean prestige) 0.002*** ,c 0.001
(3.234) (0.469)
Note: Other covariates, the same as those in Table 3, are not shown in this table. Test statistics are shown in parentheses.a The difference in the coefficient of social capital measure is insignificant.b The difference in the coefficient of social capital measure is marginally significant at the 0.1 level.c The difference in the coefficient of social capital measure is significant at the 0.05 level.
** p value < 0.01.*** p value < 0.001.
+ p value < 0.1.
Table 5Blinder–Oaxaca decomposition of difference in monthly income between migrantsand urban residents, 2005, Shanghai.
Monthly income Migrants (1) vs. urban residents (0)
General social capitalDue to difference in characteristics 26.1%Due to difference in coefficients 3.7%
Local social capitalDue to difference in characteristics 13.8%Due to difference in coefficients 8.5%
Nn
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bmfiTtec
rar
ote: Decomposition results of other predictors, the same as those in Table 3, areot shown in this table.
ural migrants tend to occupy low-prestige jobs and therefore mayot have sufficient resources to offer. It is also possible that thetructural obstacles faced by rural migrants are so powerful thatven high-status locals cannot help migrants to overcome them inrder to obtain high-status and high-paid jobs. In short, it is proba-le that the local contacts of migrants are simply unable to providealuable help.
The findings presented in Table 4 reveal the complexity of socialapital access and mobilization in urban China. On the one hand,iven their more tenuous labor market conditions and the substan-ial institutional barriers they face, migrants depend more on socialies with relatives and friends than the locals do, but these strongies mostly consist of ties with other migrants who face similarimitations. On the other hand, people who are resourceful, suchs locals and high-status individuals, are not usually accessibleo migrants and even if they are, they may not provide valuablessistance.6
Such capital return deficits, together with the unequal distri-ution of social resources, contribute to the disadvantaged laborarket outcomes of migrants. These results are strengthened by the
ndings from the Oaxaca (1973) decomposition analysis (Table 5).he idea of decomposition is to examine the relationship between
he outcome differences and variations in endowments (differ-nt characteristics of the two groups) and their returns (differentoefficients of the two groups). Specifically, this strategy allows for
6 We conducted an additional analysis restricting the sample to urbanities andecent migrants (arriving in Shanghai within 5 years) because recent migrants arerguably less susceptible to the endogeneity issue. The analysis yielded very similaresults to those in Tables 3 and 4, suggesting that the results are quite robust.
separating the proportion of income difference between migrantsand urban residents attributable to two factors: (1) the differentcharacteristics of the two groups along the dimensions of variablescontrolled for in the regression model and (2) the different rate ofreturn for these given characteristics between the two groups.
The decomposition equation is formulated as follows:
The first term on the far right-hand side of the equation indicateshow variations in the average characteristics of migrants and localscontribute to the income gap between the two groups (differentialendowments). The second term shows how variations in the effectsof various characteristics between migrants and locals contributeto the income gap between the two groups (differential returns).Here we focus on the results pertaining to social capital. Thus, thefirst term reflects the degree of capital deficits, and the second termreflects the degree of social capital return deficits.
The results show that differences in general social capital aloneexplain a very large part of the income disparity between migrantsand locals (26%), whereas differences in returns on general socialcapital contribute to a small part of the income gap (3.7%). How-ever, when we examine the role of local social capital, we see thatboth social capital deficits (differences in characteristics) and socialcapital return deficits (differences in coefficients) explain a quitecomparable (and large) part of the income gap between migrantsand locals. Specifically, the decomposition results mean that equal-izing access to local social capital between the two groups wouldbe expected to reduce the migrant-local income gap by almost 14%.Also, if the economic returns on local social capital for migrants aresimilar to those for locals, the between-group income gap wouldbe expected to decrease by 8.5%. This decomposition analysis pro-vides further evidence for the role of capital deficits and returndeficits (especially with respect to local social capital) in shapingthe migrant-local gap in economic well-being.
7. Discussion and conclusion
In the present study, we adopt the social capital perspectiveto examine local-migrant economic inequality in urban China and
demonstrate the important role of social capital in reinforcingintergroup income inequality between rural migrants and localresidents. Consistent with previous studies, we find that socialcapital, especially social capital from strong ties, has continued
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Y. Lu et al. / Social Ne
o operate in the labor market attainment process in China. How-ver, there is a great disparity in social capital possession betweenural migrants and urban local residents, with migrants being lessikely to form diverse and high-status social ties and less likely toorm ties with urbanities. In addition to a social capital deficit, rural
igrants also encounter a social capital return deficit, as we findhat local contacts and high-status contacts matter for locals butot for migrants in terms of income attainment. In other words,ven if rural migrants establish ties with local residents, these tiesay not be instrumental.Given the strong income returns on social capital and the sub-
tantial differences in access to and return on social capital betweenigrants and urban residents, it is not surprising that social capi-
al explains a large part of the income inequality between the tworoups. As a matter of fact, when social capital is taken into account,he income gap between the two groups is reduced by 40% or morend becomes statistically insignificant. An examination of the rel-tive contributions of differential access to and return on socialapital to income inequality reveals that 14% of the income gaps due to differential access to local social capital and over 8% toifferential return on local social capital.
We also explored variations in the role of social capital acrossconomic sectors and found that its role is more pronounced in therivate sector, especially the self-employment sector, where formalechanisms are least established and uncertainties are the great-
st (results are not shown but are available upon request). Hence,he role of social capital in explaining income inequality between
igrants and urbanities is also greater in the private sector.To sum up, the present study sheds light on the relative
mportance of different dimensions of social capital for migrants’conomic integration. Social capital from strong ties seems toe more important for rural migrants than for urban residents.or migrants, strong ties tend to be formed within the migrantroup. This finding is consistent with previous research in Westernocieties that shows that reliance on social solidarity in ethnicetworks is beneficial to immigrants (Waldinger, 1994; Sanderst al., 2002). It may be true that social ties with other migrants con-ect migrants to a rather restricted set of people who themselves
acked access to the full range of resources available in a boomingconomy. Nevertheless, we cannot deny the possibility that if aigrant keeps moving on to better jobs, even if just by a smallargin each time, cumulatively, this process will lead to upwardobility and reduce the income disparity between migrants and
atives (Sanders et al., 2002).However, what our study also reveals is that whereas one
ould think that establishing ties with the mainstream populationthe natives or high-status people) could be perceived as a strongignal of integration, for rural migrants in China, ties to localesidents have marginal impact and ties to high-status peopleo not matter at all. This suggests that the economic benefits ofainstream connections are conditioned by the institutional envi-
onment. In China, the institutional barriers against migrants andhe subsequent social discrimination hinder migrants’ efforts to
stablish effective relationships with local residents or high-statuseople, who generally carry more resources and influence. In thend, it is mostly migrants’ ties with migrant communities that are
eterminants of general and local social capital, 2005, Shanghai (standard errors in paren
Total (generalsocial capital)
Urban
(gener
Rural migrants (ref. urban residents) −0.176***
(0.016)
Age (ref. 15–25)26–35 −0.002 −0.039
(0.020) (0.031
s 35 (2013) 357– 369 367
instrumental for their employment. While this finding providessome evidence for migrants’ capital return deficits, it should notbe taken as suggesting that migrants should not integrate with themainstream population. In the long run, social integration wouldbe a forward step for migrants, although one cannot assume thatsuch mainstream connections will always guarantee benefits.
Overall, the present study has made two important contrib-utions to the literature. First, it extends the migration research onthe economic inequality between locals and migrants by arguingthat the economic disadvantages suffered by migrants are a result oftheir restricted access to and unfavorable return on social capital inthe labor market. Instead of focusing on the individual or structuralfactors, this social capital perspective highlights the joint actionsof stigmatized individual attributes and structural constraints inlimiting the capacity of rural migrants to accumulate and mobilizesocial capital to advance their labor market positions. The unequalaccess to and return on social capital in turn reinforces the posi-tional advantages of urban residents and reproduces the economicinequality between the two social groups.
Second, the findings provide some answers to DiMaggio andGarip’s (2012) enquiry about the role of social networks in exac-erbating or ameliorating social inequality. We argue that twoconditions are crucial for social capital to play a role in shapinginter-group economic inequality. One is the functionality of socialcapital in the labor market, which varies in different societies andacross different historical times and the other is the inequality inaccess to and return on social capital. The former is affected by thecharacteristics of the structure of a labor market, whereas the latteris affected by the social stratification structure of a society. In China,the lack of formal labor market mechanisms continues to create astrong need for and opportunities for economic actions to be orga-nized around informal channels via social relations and networks.Yet, the long-standing institutional exclusion of migrants causedby the hukou system has subsequently resulted in pervasive socialexclusion and discrimination and is, in fact, reinforced by such dailypractices. This has greatly limited the accumulation and mobiliza-tion of social capital by rural migrants. Under these circumstances,social capital has effectively reinforced and reproduced the eco-nomic inequality between migrants and urban residents in China.
Acknowledgements
This research was supported by a grant from the ResearchGrants Council of the Hong Kong Special Administrative Region(HKBU 2142/03H). The support from the Research Committee(FRG/02-03/I-39) of Hong Kong Baptist University is also grate-fully acknowledged. We would like to thank our collaborators at theInstitute of Population and Development and Shanghai Academy ofSocial Sciences for data collection, and Miss Fung Kayi for researchassistance. We also want to thank Nan Lin, Yanjie Bian, and twoanonymous reviewers for their helpful comments and sugges-tions. An earlier version of this paper was presented at the 2010Annual Meeting of the American Sociological Association, August,
Atlanta.
Appendix A.
theses).
residentsal social capital)
Migrants (generalsocial capital)
Total (localsocial capital)
−0.329***
(0.019)
0.041+ −0.010) (0.023) (0.023)
368 Y. Lu et al. / Social Networks 35 (2013) 357– 369
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