The Impact of Labor Migration on Local Socioeconomic Development: An Econometric Analysis of Income Growth and Education in Rural Counties in China in the 1990s

Zhongdong Ma, Hong Kong University of Science and Technology
Weimin Zhang, National Bureau of Statistics of China
Hongyan Cui, National Bureau of Statistics of China

The impact of labor migration on the sending community is important but understudied area. Researchers in the field are debating on whether migration undermines or boosts rural development. In this paper, we study the effect of labor migration/remittances on rural income growth and education in a multivariate framework, using data on temporary labor migration from China's 2000 census and time-series statistics of the rural counties. Results show that labor migration strongly facilitated income growth in rural China, relieving millions of peasants' families from poverty in the 1990s. It also enhanced the propensity of children having middle-school education. By contrast, the lost-of-labor effect of migration on grain production growth is barely significant and negligible, while meat and some other agricultural production grew rapidly in the sending counties. These findings suggest that labor migration have become a new growth point in rural China, contributing to the reduction of regional disparities.