The Impact of Climate Change on the Urban–Rural Income Gap in China

Abstract

Based on the annual average climate data and economic and social data from 262 prefecture-level cities in China from 2001 to 2019, this paper explores the impact of climate change on urban–rural income inequality and its mechanisms using fixed-effects (FEs) and mediated-effects (MEs) models. This study finds that (1) climate change has an inverted U-shaped relationship with the urban–rural income disparity; (2) climate change can affect the urban–rural income disparity by influencing urban and rural income levels, the regional degree of urbanization, and the labor force employment structure; (3) the impact of climate change on the urban–rural income gap is heterogeneous in East, Center, and West China; and (4) extreme heat can widen the urban–rural income gap, and extreme drought can narrow the urban–rural income gap. Climate change has a significant impact on the urban–rural income gap, and there is a need to continue to promote urbanization and the optimization of the employment structure of the workforce, reduce the vulnerability of rural residents to climate change, and narrow the urban–rural income gap.