China's Hukou System

Disparities Between Urban and Rural Residents Under the Chinese System

Forbidden City in Beijing, China
Forbidden City in Beijing, China. Matt Rosenberg

China's Hukou system is a family registration program that serves as a domestic passport, regulating population distribution and rural-to-urban migration. It is a tool for social and geographic control that enforces an apartheid structure of rights enforcement. The Hukou system denies farmers the same rights and benefits enjoyed by urban residents. 

History of the Hukou System

The modern Hukou system was formalized as a permanent program in 1958 meant to ensure social, political, and economic stability. China's largely-agrarian economy during the early days of the People's Republic of China (PRC) was seen as a problem. In order to speed up industrialization, the government followed the Soviet model and prioritized heavy industry. 

To finance this hurried industrialization, the state underpriced agricultural products and overpriced industrial goods to induce unequal exchange between the two sectors. Essentially, peasants were paid less than market value for their agricultural goods. The government imposed a system to restrict the free flow of resources, especially labor, between industry and agriculture or between the city and countryside to sustain this artificial imbalance. This system is still in place.

Individuals are categorized by the state as either rural or urban and assigned to geographic areas. Travel between these is permitted only under controlled conditions and residents are not given access to jobs, public services, education, healthcare, or food in areas outside of their designated area. 

A rural farmer who chooses to move to the city without a government-issued hukou, for example, shares a status similar to that of an illegal immigrant to the U.S. Obtaining an official rural-to-urban hukou is extremely difficult because the Chinese government has tight quotas on conversions per year. 

Effects of the Hukou System

The Hukou system has always benefited urbanites and disadvantaged country-dwellers. Take the Great Famine of the mid-twentieth century, for example. During the Great Famine, individuals with rural hukous were collectivized into communal farms and much of their agricultural output was taken in the form of taxes by the state and given to city-dwellers. This led to massive starvation in the countryside but the Great Leap Forward, or campaign for rapid urbanization, was not abolished until its negative effects were felt in the city.

After the Great Famine, urban citizens enjoyed a range of socio-economic benefits and rural residents continued to be marginalized. Even today, a farmer's income is one-sixth that of the average urban dweller. In addition, farmers have to pay three times more in taxes but receive lower standards of education, healthcare, and living. The Hukou system impedes upward mobility, essentially creating a caste system that governs Chinese society. 

Since the capitalist reforms of the late 1970s, an estimated 260 million rural dwellers have illegally moved to cities in an attempt to escape their bleak situations and partake in the remarkable economic development of urban life. These migrants brave discrimination and possible arrest just by living on the urban fringe in shantytowns, railway stations, and street corners. They are often blamed for rising crime and unemployment rates. 

Reform

As China became industrialized, the Hukou system was reformed in order to adapt to a new economic reality. In 1984, the State Council conditionally opened the doors of market towns to peasants. Country residents were allowed to get a new type of permit called a “self-supplied food grain” hukou provided that they satisfied a number of requirements. The primary requirements are: a migrant must be employed in enterprise, have their own accommodations in the new location, and able to provide their own food grain. Cardholders are still not eligible for many state services and cannot move to urban areas ranked higher than their own.

In 1992, the PRC launched another permit called the "blue-stamp" hukou. Unlike the "self-supplied food grain" hukou that is limited to a particular subset of business peasants, the "blue stamp" hukou is open to a wide population and allows migration into bigger cities. Some of these cities include the Special Economic Zones (SEZ), which are havens for foreign investments. Eligibility is primarily limited to those with familial relations to domestic and overseas investors.

The Hukou system experienced another form of liberation in 2001​ after China joined the World Trade Organization (WTO). Although WTO membership exposed China's agricultural sector to foreign competition and led to widespread job loss, it also galvanized labor-intensive sectors such as textile and clothing. This led to increased demand in urban labor and the intensity of patrols and documentation inspections were relaxed to accommodate. 

In 2003, changes were also made to how illegal migrants are detained and processed. This was the result of a media- and internet-frenzied case in which a college-educated urbanite named Sun Zhigang was taken into custody and beaten to death for working in the megacity of Guangzhou without the proper Hukou ID.

Despite many reforms, the Hukou system still remains fundamentally intact and causes continued disparities between the state's agricultural and industrial sectors. Although the system is highly controversial and vilified, its complete abandonment is not practical due to the complexity and interconnectedness of the modern Chinese economic society. Its removal would lead to a massive exodus of people into cities that could instantly cripple urban infrastructures and destroy rural economies. For now, minor changes will continue to be made to respond to China's shifting political climate.