In this paper, we examine the impact of reductions in barriers to migration on the
consumption of households in rural China. We find that increased migration from rural
villages leads to significant increases in consumption per capita, and that this effect is
stronger for poorer households within villages. Household income per capita and non-durable
consumption per capita both increase with out-migration, and this increase is greater for
poorer households. We also establish a causal relationship between increased out-migration
and investment in housing and durable goods assets, and these effects are also stronger for
poorer households. We do not find robust evidence, however, to support a connection
between increased migration and investment in productive activity. Instead, increased
migration is associated with two significant changes for poorer households: increases both in
the total labor supplied to productive activities and in the land per capita managed by the
household. In examining the effect of migration, we pay considerable attention to motivating,
developing and evaluating our identification strategy.