By drawing on a unique farm survey conducted in Baoding and Wuxi in the 1930s, this article provides a narrative of the economy, markets, and income of these two counties located in northern and southern China, respectively. The data clearly show that these two regional economies differed radically in the structure of the economy and income distribution. In Wuxi, migration was primarily motivated by “pull” factors, whereas Baoding peasants were primarily “pushed” out by land deficiency. Because of their higher human capital, Wuxi migrants had a substantially higher per capita income than those who did not migrate. In contrast, migrant households in Baoding showed little advantage in per capita income. This difference was highly correlated with human capital rather than the development o...[ Read more ]

By drawing on a unique farm survey conducted in Baoding and Wuxi in the 1930s, this article provides a narrative of the economy, markets, and income of these two counties located in northern and southern China, respectively. The data clearly show that these two regional economies differed radically in the structure of the economy and income distribution. In Wuxi, migration was primarily motivated by “pull” factors, whereas Baoding peasants were primarily “pushed” out by land deficiency. Because of their higher human capital, Wuxi migrants had a substantially higher per capita income than those who did not migrate. In contrast, migrant households in Baoding showed little advantage in per capita income. This difference was highly correlated with human capital rather than the development of commercialization-cum-industrialization, indicating that the development of commercialization-cum-industrialization was not the main force lifting China out of the “involution trap.” Despite rapid commercialization-cum-industrialization, peasants with low human capital could not take advantage of these opportunities in Baoding. Only when peasants had the advantage in human capital could they benefit from this development, as seen in Wuxi.

Key words: human capital, commercialization-cum-industrialization, migration, income, Baoding, Wuxi.