“…Second, we extend to the emerging literature on the economic consequences of the labor market reform in China. Prior studies have explored the effect of hukou reform on employment adjustment (Wang, Milner, et al, 2021), corporate innovation (Chen et al, 2020), corporate investment (Wu et al, 2022), labor market outcomes of both incumbent migrants and natives (An et al, 2020), migration for different types of workers (Jin & Zhang, 2023), social welfare (Cai, 2011), economic development (Bosker et al, 2012;Hsu & Ma, 2021), and psychological well-being (Song & Smith, 2021). Much of the literature finds a positive impact of the hukou reform.…”