IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v99y2012i2p513-520.html
   My bibliography  Save this article

Does having a cadre parent pay? Evidence from the first job offers of Chinese college graduates

Author

Listed:
  • Li, Hongbin
  • Meng, Lingsheng
  • Shi, Xinzheng
  • Wu, Binzhen

Abstract

We estimate the wage premium associated with having a cadre parent in China using a recent survey of college graduates carried out by the authors. The wage premium of having a cadre parent is 15%, and this premium cannot be explained by other observables such as college entrance exam scores, quality of colleges and majors, a full set of college human capital attributes, and job characteristics. These results suggest that the remaining premium could be the true wage premium of having a cadre parent.

Suggested Citation

  • Li, Hongbin & Meng, Lingsheng & Shi, Xinzheng & Wu, Binzhen, 2012. "Does having a cadre parent pay? Evidence from the first job offers of Chinese college graduates," Journal of Development Economics, Elsevier, vol. 99(2), pages 513-520.
    • Handle: RePEc:eee:deveco:v:99:y:2012:i:2:p:513-520
    DOI: 10.1016/j.jdeveco.2012.06.005
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304387812000508
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jdeveco.2012.06.005?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Morduch, Jonathan & Sicular, Terry, 2000. "Politics, growth, and inequality in rural China: does it pay to join the Party?," Journal of Public Economics, Elsevier, vol. 77(3), pages 331-356, September.
    2. Griliches, Zvi & Mason, William M, 1972. "Education, Income, and Ability," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages 74-103, Part II, .
    3. Lam, David & Schoeni, Robert F, 1993. "Effects of Family Background on Earnings and Returns to Schooling: Evidence from Brazil," Journal of Political Economy, University of Chicago Press, vol. 101(4), pages 710-740, August.
    4. Agrawal, Anup & Knoeber, Charles R, 2001. "Do Some Outside Directors Play a Political Role?," Journal of Law and Economics, University of Chicago Press, vol. 44(1), pages 179-198, April.
    5. repec:pri:cheawb:case_paxson_economic_status_paper is not listed on IDEAS
    6. Gustafsson,Björn A. & Shi,Li & Sicular,Terry (ed.), 2008. "Inequality and Public Policy in China," Cambridge Books, Cambridge University Press, number 9780521870450.
    7. Duane E. Leigh & Andrew M. Gill, 1997. "Labor Market Returns to Community Colleges: Evidence for Returning Adults," Journal of Human Resources, University of Wisconsin Press, vol. 32(2), pages 334-353.
    8. Jere R. Behrman & Mark R. Rosenzweig, 2002. "Does Increasing Women's Schooling Raise the Schooling of the Next Generation?," American Economic Review, American Economic Association, vol. 92(1), pages 323-334, March.
    9. McKinley Blackburn & David Neumark, 1992. "Unobserved Ability, Efficiency Wages, and Interindustry Wage Differentials," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(4), pages 1421-1436.
    10. Chen, Yuyu & Li, Hongbin, 2009. "Mother's education and child health: Is there a nurturing effect?," Journal of Health Economics, Elsevier, vol. 28(2), pages 413-426, March.
    11. Monks, James, 2000. "The returns to individual and college characteristics: Evidence from the National Longitudinal Survey of Youth," Economics of Education Review, Elsevier, vol. 19(3), pages 279-289, June.
    12. Jonathan Morduch & Terry Sicular, 2002. "Rethinking Inequality Decomposition, With Evidence from Rural China," Economic Journal, Royal Economic Society, vol. 112(476), pages 93-106, January.
    13. repec:pri:cheawb:case_paxson_economic_status_paper.pdf is not listed on IDEAS
    14. Long, Mark C., 2008. "College quality and early adult outcomes," Economics of Education Review, Elsevier, vol. 27(5), pages 588-602, October.
    15. Yannis M. Ioannides & Linda Datcher Loury, 2004. "Job Information Networks, Neighborhood Effects, and Inequality," Journal of Economic Literature, American Economic Association, vol. 42(4), pages 1056-1093, December.
    16. Hongbin Li & Pak Wai Liu & Ning Ma & Junsen Zhang, 2005. "Economic Returns to Communist Party Membership: Evidence from Chinese Twins," Discussion Papers 00015, Chinese University of Hong Kong, Department of Economics.
    17. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "Why the Apple Doesn't Fall Far: Understanding Intergenerational Transmission of Human Capital," American Economic Review, American Economic Association, vol. 95(1), pages 437-449, March.
    18. Erik Plug, 2004. "Estimating the Effect of Mother's Schooling on Children's Schooling Using a Sample of Adoptees," American Economic Review, American Economic Association, vol. 94(1), pages 358-368, March.
    19. Shea, John, 2000. "Does parents' money matter?," Journal of Public Economics, Elsevier, vol. 77(2), pages 155-184, August.
    20. Hongbin Li & Lingsheng Meng & Junsen Zhang, 2006. "Why Do Entrepreneurs Enter Politics? Evidence from China," Economic Inquiry, Western Economic Association International, vol. 44(3), pages 559-578, July.
    21. Li, Hongbin & Zhou, Li-An, 2005. "Political turnover and economic performance: the incentive role of personnel control in China," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1743-1762, September.
    22. Jiahua Che & Yingyi Qian, "undated". "Insecure Property Rights and Government Ownership of Firms," Working Papers 97050, Stanford University, Department of Economics.
    23. Frye, Timothy & Shleifer, Andrei, 1997. "The Invisible Hand and the Grabbing Hand," American Economic Review, American Economic Association, vol. 87(2), pages 354-358, May.
    24. Zhang, Junsen & Zhao, Yaohui & Park, Albert & Song, Xiaoqing, 2005. "Economic returns to schooling in urban China, 1988 to 2001," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 730-752, December.
    25. Hongbin Li & PakWai Liu & Junsen Zhang & Ning Ma, 2007. "Economic Returns to Communist Party Membership: Evidence From Urban Chinese Twins," Economic Journal, Royal Economic Society, vol. 117(523), pages 1504-1520, October.
    26. Black, Sandra E. & Devereux, Paul J., 2011. "Recent Developments in Intergenerational Mobility," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 16, pages 1487-1541, Elsevier.
    27. Li, Hongbin & Meng, Lingsheng & Wang, Qian & Zhou, Li-An, 2008. "Political connections, financing and firm performance: Evidence from Chinese private firms," Journal of Development Economics, Elsevier, vol. 87(2), pages 283-299, October.
    28. Anne Case & Darren Lubotsky & Christina Paxson, 2002. "Economic Status and Health in Childhood: The Origins of the Gradient," American Economic Review, American Economic Association, vol. 92(5), pages 1308-1334, December.
    29. David D. Li, 1996. "A Theory of Ambiguous Property Rights in Transition Economies: The Case of the Chinese Non-State Sector," William Davidson Institute Working Papers Series 8, William Davidson Institute at the University of Michigan.
    30. Liu, Zhiqiang, 2003. "The Economic Impact and Determinants of Investment in Human and Political Capital in China," Economic Development and Cultural Change, University of Chicago Press, vol. 51(4), pages 823-849, July.
    31. Dominic J. Brewer & Eric R. Eide & Ronald G. Ehrenberg, 1999. "Does It Pay to Attend an Elite Private College? Cross-Cohort Evidence on the Effects of College Type on Earnings," Journal of Human Resources, University of Wisconsin Press, vol. 34(1), pages 104-123.
    32. Hongbin Li & Li-An Zhou, 2003. "Political Turnover and Economic Performance: The Disciplinary Role of Personnel Control in China," Discussion Papers 00002, Chinese University of Hong Kong, Department of Economics.
    33. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    34. Johnson, Simon & Mitton, Todd, 2003. "Cronyism and capital controls: evidence from Malaysia," Journal of Financial Economics, Elsevier, vol. 67(2), pages 351-382, February.
    35. Mara Faccio, 2006. "Politically Connected Firms," American Economic Review, American Economic Association, vol. 96(1), pages 369-386, March.
    36. Li, David D., 1996. "A Theory of Ambiguous Property Rights in Transition Economies: The Case of the Chinese Non-State Sector," Journal of Comparative Economics, Elsevier, vol. 23(1), pages 1-19, August.
    37. Griliches, Zvi, 1977. "Estimating the Returns to Schooling: Some Econometric Problems," Econometrica, Econometric Society, vol. 45(1), pages 1-22, January.
    38. Dan A. Black & Jeffrey A. Smith, 2006. "Estimating the Returns to College Quality with Multiple Proxies for Quality," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 701-728, July.
    39. Jiahua Che & Yingyi Qian, 1998. "Insecure Property Rights and Government Ownership of Firms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(2), pages 467-496.
    40. Asim Ijaz Khwaja & Atif Mian, 2005. "Do Lenders Favor Politically Connected Firms? Rent Provision in an Emerging Financial Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(4), pages 1371-1411.
    41. Raymond Fisman, 2001. "Estimating the Value of Political Connections," American Economic Review, American Economic Association, vol. 91(4), pages 1095-1102, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wencai Hu & Mengru Sun, 2023. "COVID-19 Stressors and Aggression among Chinese College Students: The Mediation Role of Coping Strategies," IJERPH, MDPI, vol. 20(4), pages 1-13, February.
    2. Hongbin Li & Huan Wang & Claire Cousineau & Matthew Boswell, 2023. "What Can Students Gain from China's Higher Education?," Asian Economic Policy Review, Japan Center for Economic Research, vol. 18(2), pages 287-304, July.
    3. Zhi Li & Hai Zhong, 2017. "The impact of higher education expansion on intergenerational mobility," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 25(4), pages 575-591, October.
    4. Chen, Liwen & Chung, Bobby W. & Wang, Guanghua, 2023. "Exposure to socially influential peer parents: Evidence from cadre parents in China," China Economic Review, Elsevier, vol. 78(C).
    5. Markussen, Thomas & Ngo, Quang-Thanh, 2019. "Economic and non-economic returns to communist party membership in Vietnam," World Development, Elsevier, vol. 122(C), pages 370-384.
    6. Zhang, Huafeng, 2014. "The poverty trap of education: Education–poverty connections in Western China," International Journal of Educational Development, Elsevier, vol. 38(C), pages 47-58.
    7. Matthias Blum & Alan de Bromhead, 2017. "Rise and Fall in the Third Reich: Social Mobility and Nazi Membership," Economics Working Papers 17-01, Queen's Management School, Queen's University Belfast.
    8. Markussen, Thomas & Ngo, Quang-Thanh, 2019. "Economic and non-economic returns to communist party membership in Vietnam," World Development, Elsevier, vol. 122(C), pages 370-384.
    9. Blum, Matthias & de Bromhead, Alan, 2019. "Rise and fall in the Third Reich: Social advancement and Nazi membership," European Economic Review, Elsevier, vol. 120(C).
    10. FAN, Yi, 2016. "Intergenerational income persistence and transmission mechanism: Evidence from urban China," China Economic Review, Elsevier, vol. 41(C), pages 299-314.
    11. Hai Zhong, 2013. "Does Education Expansion Increase Intergenerational Mobility?," Economica, London School of Economics and Political Science, vol. 80(320), pages 760-773, October.
    12. Sun, Weizeng & Zhang, Sisi & Lin, Chengtao & Zheng, Siqi, 2021. "How do home purchase restrictions affect elite Chinese graduate students’ job search behavior?," Regional Science and Urban Economics, Elsevier, vol. 87(C).
    13. Zhang, Jian & Jin, Songqing & Li, Tao & Wang, Haigang, 2021. "Gender discrimination in China: Experimental evidence from the job market for college graduates," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 819-835.
    14. Wei Si, 2022. "Higher education expansion and gender norms: evidence from China," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(4), pages 1821-1858, October.
    15. Liwen Chen & Bobby Chung & Guanghua Wang, 2021. "Exposure to Socially Influential Peer Parents: Evidence from Cadre Parents in China," Working Papers 2021-052, Human Capital and Economic Opportunity Working Group.
    16. Hayward, Mathew & Cheng, Zhiming & Zhe Wang, Ben, 2022. "Disrupted education, underdogs and the propensity for entrepreneurship: Evidence from China’s sent-down youth program," Journal of Business Research, Elsevier, vol. 151(C), pages 33-39.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Feng, Xunan & Johansson, Anders C. & Zhang, Tianyu, 2014. "Political participation and entrepreneurial initial public offerings in China," Journal of Comparative Economics, Elsevier, vol. 42(2), pages 269-285.
    2. Chen, Liwen & Chung, Bobby W. & Wang, Guanghua, 2023. "Exposure to socially influential peer parents: Evidence from cadre parents in China," China Economic Review, Elsevier, vol. 78(C).
    3. Markussen, Thomas & Ngo, Quang-Thanh, 2019. "Economic and non-economic returns to communist party membership in Vietnam," World Development, Elsevier, vol. 122(C), pages 370-384.
    4. Hongbin Li & PakWai Liu & Junsen Zhang & Ning Ma, 2007. "Economic Returns to Communist Party Membership: Evidence From Urban Chinese Twins," Economic Journal, Royal Economic Society, vol. 117(523), pages 1504-1520, October.
    5. James Kai‐sing Kung & Chicheng Ma, 2018. "Friends with Benefits: How Political Connections Help to Sustain Private Enterprise Growth in China," Economica, London School of Economics and Political Science, vol. 85(337), pages 41-74, January.
    6. Li, Hongbin & Meng, Lingsheng & Wang, Qian & Zhou, Li-An, 2008. "Political connections, financing and firm performance: Evidence from Chinese private firms," Journal of Development Economics, Elsevier, vol. 87(2), pages 283-299, October.
    7. Zhi Li & Hai Zhong, 2017. "The impact of higher education expansion on intergenerational mobility," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 25(4), pages 575-591, October.
    8. Jin, Yanhong & Fan, Maoyong & Cheng, Mingwang & Shi, Qinghua, 2014. "The economic gains of cadre status in rural China: Investigating effects and mechanisms," China Economic Review, Elsevier, vol. 31(C), pages 185-200.
    9. Liu, Qigui & Tang, Jinghua & Tian, Gary Gang, 2013. "Does political capital create value in the IPO market? Evidence from China," Journal of Corporate Finance, Elsevier, vol. 23(C), pages 395-413.
    10. Maggie Xiaoyang Chen, 2013. "The Matching Of Heterogeneous Firms And Politicians," Economic Inquiry, Western Economic Association International, vol. 51(2), pages 1502-1522, April.
    11. Habib, Ahsan & Muhammadi, Abdul Haris & Jiang, Haiyan, 2017. "Political connections, related party transactions, and auditor choice: Evidence from Indonesia," Journal of Contemporary Accounting and Economics, Elsevier, vol. 13(1), pages 1-19.
    12. Long,Cheryl Xiaoning & Xu,L. Colin & Yang,Jin, 2020. "Business Environment and Dual-Track Private Sector Development : China's Experience in Two Crucial Decades," Policy Research Working Paper Series 9161, The World Bank.
    13. Feng Liu & Hui Lin & Huiying Wu, 2018. "Political Connections and Firm Value in China: An Event Study," Journal of Business Ethics, Springer, vol. 152(2), pages 551-571, October.
    14. Liwen Chen & Bobby Chung & Guanghua Wang, 2021. "Exposure to Socially Influential Peer Parents: Evidence from Cadre Parents in China," Working Papers 2021-052, Human Capital and Economic Opportunity Working Group.
    15. Habib, Ahsan & Ranasinghe, Dinithi & Muhammadi, Abdul Haris & Islam, Ainul, 2018. "Political connections, financial reporting and auditing: Survey of the empirical literature," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 31(C), pages 37-51.
    16. Zhong-qin Su & Hung-Gay Fung, 2013. "Political Connections and Firm Performance in Chinese Companies," Pacific Economic Review, Wiley Blackwell, vol. 18(3), pages 283-317, August.
    17. Wenjing Li & Ran Zhang, 2010. "Corporate Social Responsibility, Ownership Structure, and Political Interference: Evidence from China," Journal of Business Ethics, Springer, vol. 96(4), pages 631-645, November.
    18. Bao, Xiaolu & Johan, Sofia & Kutsuna, Kenji, 2016. "Do political connections matter in accessing capital markets? Evidence from China," Emerging Markets Review, Elsevier, vol. 29(C), pages 24-41.
    19. Cumming, Douglas & Rui, Oliver & Wu, Yiping, 2016. "Political instability, access to private debt, and innovation investment in China," Emerging Markets Review, Elsevier, vol. 29(C), pages 68-81.
    20. Habib, Ahsan & Muhammadi, Abdul Haris & Jiang, Haiyan, 2017. "Political Connections and Related Party Transactions: Evidence from Indonesia," The International Journal of Accounting, Elsevier, vol. 52(1), pages 45-63.

    More about this item

    Keywords

    Inter-generational transfer; Political status; College education; China;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:99:y:2012:i:2:p:513-520. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/devec .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.