This paper estimates the returns to education of rural-urban migrants during the period of
transition of China’s economy between 1995 and 2008. Using data from CHIP and RUMiC,
we find that rural migrants’ earning differentials with urban residents are substantial and
mainly depend on the type of occupation, industry, and employers’ ownership, rather than the
level of education completed. Returns to formal schooling for migrants remained stable at
approximately 3% and 5% throughout the period, and differences across quantiles are
generally statistically insignificant. Increasing gaps in the return to schooling by gender have
instead emerged. These results raise questions about the incentives to invest in human
capital for rural migrants and for the governments funding education in emigration regions.