Impact of high-speed rail on wage premiums for migrant workers in China

Abstract

The extensive high-speed rail (HSR) network in China has significantly enhanced regional population mobility, yet its impact on the well-being of migrant workers remains underexplored. Utilizing data from the China Migrant Dynamic Survey (CMDS) from 2014 to 2018, this study investigates the influence of HSR on wage premiums for migrant workers and identifies the factors driving these premiums using the non-parametric nearest neighbor matching method. The findings reveal that HSR confers a significant wage premium of 13.1% for migrant workers in cities with HSR infrastructure compared to cities without it. This wage premium effect is particularly pronounced in less developed western China and in cities with larger populations and a higher proportion of tertiary sector economy. The study finds a 10.54% increase in wage premiums for intra-province migrant workers due to HSR, while the effect remains negligible for inter-province migrant workers. Moreover, the wage premium effect is stronger for higher-skilled labor and for migrant workers aged 16 to 45. It is particularly significant for professionals, administrative staff, and workers in the service industry. The HSR wage premium effect is multifaceted, exhibiting both level and growth effects, with the latter intensifying over time after HSR introduction. Overall, the findings suggest that HSR deployment positively influences migrant worker wages by enhancing travel convenience, improving market access, fostering knowledge spillovers, and facilitating industry transfers. However, these impacts vary by location, skill level, and industry.