The impact of high-speed railway on labor market between the North and South: evidence from China

Labor divergence between North and South has formed, and the high-speed rail (HSR) plays a key role in labor's agglomeration in China. Regarding China's HSR as a quasi-natural experiment, we construct a difference-in-difference (DID) model to explore the impact of HSR on the labor market of North and South China based on the panel data of 285 cities in China from 1998 to 2018. HSR significantly enhances labor quantity and relieves labor misallocation in South China, while has an insignificant effect on labor quality. It mainly improves the allocation efficiency of the labor market by the improved regional accessibility, which has obvious threshold effects on labor quantity at 2109.8 km from the northernmost part of China, respectively. Furthermore, Confucian culture (CC) weakens the impact of HSR on labor market especially for South China except strengthens that on northern labor quality. Therefore, the labor mobility between North and South China is the result of the combined effect of HSR's thrust and CC's pull, so policymakers should strengthen the construction of HSR network and increase the investment in southern education and northern public cultural construction to reduce barriers of labor mobility between North and South China.