Transforming Family Enterprise: Investing Behaviors of Labor Migrants in China

Zhongdong Ma, Hong Kong University of Science and Technology
Edward J.C. Tu, Hong Kong University of Science and Technology

Labor migration has a major function in financing housing infrastructure change for rural family enterprises. We argue that the use of remittances on housing complements rather than deters productive investments. Based on an in-depth survey of returned migrants in rural China, we focus on the explanation of investment behaviors of the temporary migrants. The major use of remittances on housing was accompanied by investments on children's education and agricultural production. Skilled migrants who were more prone to financing housing during migration also had a greater investment propensity after returning home. The above findings suggest that home infrastructure change, human capital formation, and productive investments are integral parts of a transformation from familial to commercial production.