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This paper uses survey data from Chinese Household Income Project (CHIP) to document wages and returns to education for a large number of cities during China's economic transition. Between 1988 and 1995, average real wages and returns to education increased, yet their spatial dispersions across cities widened dramatically. While market-oriented reforms should help equalize returns to human capital across regions, there was no sign of significant wage convergence in Chinese cities during this period. I argue that coordinated reforms in pension systems, housing markets, hukou registration, and local government behavior are imperative for improving the integration of local labor markets in China.

Huge econometric literatures examine discrimination in wealthy countries, but very little is available on poorer countries. In this study we combine labor-market information, appraisals of respondents' beauty, and household expenditures to examine within a unified framework the role of beauty in economic success in China and the relative importance of the investment and consumption aspects of beautifying expenditures. We find that in China, beauty raises women's earnings adjusted for a wide range of controls. Additional spending on clothing and cosmetics has a generally positive marginal impact on a woman's perceived beauty. The relative size of the effect demonstrates, however, that such purchases pay back no more than 15 percent of additional expenditure in the form of higher earnings. Most such spending represents consumption. The overall effect of beauty on wages appears to be at least as high, or even higher, than in rich economies.