Would you like to leave Beijing, Shanghai, or Shenzhen? An empirical analysis of migration effect in China

This study aims to estimate the migration effect of the overall samples and different flowing scales for the floating population from the perspective of personal wages. Although we used both the OLS and PSM methods to estimate the migration effect, we found that the PSM method was preferred in the study of migration as a result of the selection bias. The empirical results show that there is a significant difference in wage before and after migration. In fact, migration increased wages by 15.18% to 23.63% overall. Additionally, wages were increased by 44.96% to 59.20%, 23.06% to 26.18%, and 10.89% to 15.08% respectively for these three migration patterns: flowing into the three largest megacities, inter-provincial migration, and inter-city migration within a province, but for this pattern of inter-district migration within a city, the migration effect is not significant. We concluded that the floating population removing policies of the largest megacities maybe are effective because of the administrative power of their government. On the other hand, for these policies of non-largest megacities to attract labor and local employment and local urbanization near the floating population’s place of origin, they were not effective enough as a result of the lack of significant migration effect in these cities.