Consistent with the baseline results presented in section IV.B, we find that, although there is still a significant difference in hourly earnings between rural migrant and urban workers, the majority of this gap can be explained by differences in the individual characteristics and human capital levels of workers. After we add a control for years of schooling in Table 6, the magnitude of the coefficient estimate decreases from 0.308 in column 3 to 0.084 in column 4. Given that we also find that the coefficient on the years of schooling variable is positive and significant, the results appear to suggest that lower levels of educational attainment among rural migrant workers explain most of the hourly earnings gap. In addition, when we compare the coefficient estimates in column 1 (−0.322) and column 4 (−0.084), we find that 73.9% of the hourly earnings gap between rural migrant and urban workers can be explained by differences in individual characteristics and human capital.
| . | Hourly Earnings in Logarithm . | |||
|---|---|---|---|---|
| . | (1) . | (2) . | (3) . | (4) . |
| Rural migrant | −0.322*** | −0.307*** | −0.308*** | −0.084*** |
| (0.015) | (0.014) | (0.014) | (0.014) | |
| Male | 0.265*** | 0.285*** | 0.218*** | |
| (0.013) | (0.013) | (0.012) | ||
| Age | 0.058*** | 0.067*** | ||
| (0.005) | (0.004) | |||
| Age squared | −0.001*** | −0.001*** | ||
| (0.000) | (0.000) | |||
| Years of schooling | 0.086*** | |||
| (0.002) | ||||
| Hubei | −0.205*** | −0.214*** | −0.191*** | −0.229*** |
| (0.014) | (0.014) | (0.014) | (0.013) | |
| R-squared | 0.075 | 0.121 | 0.145 | 0.272 |
| Number of observations | 7,799 | 7,799 | 7,799 | 7,799 |
| . | Hourly Earnings in Logarithm . | |||
|---|---|---|---|---|
| . | (1) . | (2) . | (3) . | (4) . |
| Rural migrant | −0.322*** | −0.307*** | −0.308*** | −0.084*** |
| (0.015) | (0.014) | (0.014) | (0.014) | |
| Male | 0.265*** | 0.285*** | 0.218*** | |
| (0.013) | (0.013) | (0.012) | ||
| Age | 0.058*** | 0.067*** | ||
| (0.005) | (0.004) | |||
| Age squared | −0.001*** | −0.001*** | ||
| (0.000) | (0.000) | |||
| Years of schooling | 0.086*** | |||
| (0.002) | ||||
| Hubei | −0.205*** | −0.214*** | −0.191*** | −0.229*** |
| (0.014) | (0.014) | (0.014) | (0.013) | |
| R-squared | 0.075 | 0.121 | 0.145 | 0.272 |
| Number of observations | 7,799 | 7,799 | 7,799 | 7,799 |
Notes: Robust standard errors in parentheses. ***p < 0.01, **p < 0.05, *p < 0.1. Rural migrant workers are those who work in manufacturing (nonagriculture sector) and have a rural hukou. Hourly earnings are measured by dividing the monthly earnings measure by average hours worked per month. Hubei is a dummy variable where 1 denotes Hubei province and 0 denotes Guangdong province.
Source: Authors’ calculations.