IDEAS home Printed from https://ideas.repec.org/a/rfa/aefjnl/v5y2018i6p61-75.html
   My bibliography  Save this article

Inefficient Signalling, Education Arms Race and Education Inflation in China

Author

Listed:
  • Weiguang Liu

Abstract

Since the higher education expansion and education marketization from 1998, China¡¯s education inflation has become increasingly serious. And correspondingly, the income of graduates remains in a low level. This paper built a model and explained two important reasons. First, the quality of Chinese high education is relatively low, which means the signal effect of education will be less efficient. Second, every individual has an incentive to occupy higher status in the education hierarchy, which means there is a zero-sum education arms race game. I try to build a simple but powerful model in this essay to explain how thses two factors contribute to Chinese education inflation and how they intertwine with each other.

Suggested Citation

  • Weiguang Liu, 2018. "Inefficient Signalling, Education Arms Race and Education Inflation in China," Applied Economics and Finance, Redfame publishing, vol. 5(6), pages 61-75, November.
    • Handle: RePEc:rfa:aefjnl:v:5:y:2018:i:6:p:61-75
    as

    Download full text from publisher

    File URL: http://redfame.com/journal/index.php/aef/article/view/3683/3832
    Download Restriction: no
    File URL: http://redfame.com/journal/index.php/aef/article/view/3683
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Patrizia Ordine & Giuseppe Rose, 2017. "Too Many Graduates? A Matching Theory of Educational Mismatch," Journal of Human Capital, University of Chicago Press, vol. 11(4), pages 423-446.
    2. Rajagopal, 2014. "The Human Factors," Palgrave Macmillan Books, in: Architecting Enterprise, chapter 9, pages 225-249, Palgrave Macmillan.
    3. Arrow, Kenneth J., 1973. "Higher education as a filter," Journal of Public Economics, Elsevier, vol. 2(3), pages 193-216, July.
    4. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    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. Kristinn Hermannsson & Patrizio Lecca, 2016. "Human Capital in Economic Development: From Labour Productivity to Macroeconomic Impact," Economic Papers, The Economic Society of Australia, vol. 35(1), pages 24-36, March.
    2. Inmaculada Garc�a-Mainar & V�ctor M. Montuenga-G�mez, 2017. "Subjective educational mismatch and signalling in Spain," Documentos de Trabajo dt2017-03, Facultad de Ciencias Económicas y Empresariales, Universidad de Zaragoza.
    3. Nakabayashi, Masaki, 2011. "Schooling, employer learning, and internal labor market effect: Wage dynamics and human capital investment in the Japanese steel industry, 1930-1960s," MPRA Paper 30597, University Library of Munich, Germany.
    4. Benson, Rebecca & von Hippel, Paul T. & Lynch, Jamie L., 2018. "Does more education cause lower BMI, or do lower-BMI individuals become more educated? Evidence from the National Longitudinal Survey of Youth 1979," Social Science & Medicine, Elsevier, vol. 211(C), pages 370-377.
    5. Domadenik, Polona & Far?nik, Daša & Pastore, Francesco, 2013. "Horizontal Mismatch in the Labour Market of Graduates: The Role of Signalling," IZA Discussion Papers 7527, Institute of Labor Economics (IZA).
    6. Ahrens, Jan-Philipp & Landmann, Andreas & Woywode, Michael, 2015. "Gender preferences in the CEO successions of family firms: Family characteristics and human capital of the successor," Journal of Family Business Strategy, Elsevier, vol. 6(2), pages 86-103.
    7. Jascha-Alexander Koch & Michael Siering, 2019. "The recipe of successful crowdfunding campaigns," Electronic Markets, Springer;IIM University of St. Gallen, vol. 29(4), pages 661-679, December.
    8. Joaquin Turmo-Garuz & M.-Teresa Bartual-Figueras & Francisco-Javier Sierra-Martinez, 2019. "Factors Associated with Overeducation Among Recent Graduates During Labour Market Integration: The Case of Catalonia (Spain)," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 144(3), pages 1273-1301, August.
    9. David A Green & W Craig Riddell, "undated". "Literacy, Numeracy and Labour Market Outcomes in Canada," Canadian International Labour Network Working Papers 47, McMaster University.
    10. Herbert Brücker & Albrecht Glitz & Adrian Lerche & Agnese Romiti, 2021. "Occupational Recognition and Immigrant Labor Market Outcomes," Journal of Labor Economics, University of Chicago Press, vol. 39(2), pages 497-525.
    11. Jhon James Mora, 2003. "Sheepskin effects and screening in Colombia," Colombian Economic Journal, Universidad Nacional de Colombia, FCE, CID, April.
      • Jhon James Mora, 2003. "Sheepskin effects and screening in Colombia," Colombian Economic Journal, Academia Colombiana de Ciencias Economicas, Colegio Mayor de Nuestra Senora del Rosario, Pontificia Universidad Javeriana, Universidad de Antioquia, Universidad de los Andes, Universidad del Valle, Universidad Externado de Colombia, Universidad Nacional de Colombia, vol. 1(1), pages 95-108, December.
    12. Luisa Rosti & Chikara Yamaguchi & Carolina Castagnetti, 2005. "Educational Performance as Signalling Device: Evidence from Italy," Economics Bulletin, AccessEcon, vol. 9(4), pages 1-7.
    13. Matthias Bogaert & Michel Ballings & Dirk Van den Poel, 2018. "Evaluating the importance of different communication types in romantic tie prediction on social media," Annals of Operations Research, Springer, vol. 263(1), pages 501-527, April.
    14. Magali Jaoul-Grammare, 2007. "The labour market segmentation: empirical analysis of Cain's theory (1976)," Applied Economics Letters, Taylor & Francis Journals, vol. 14(5), pages 337-341.
    15. Nicolas Hérault & Rezida Zakirova, 2011. "Sheepskin Effects in the Returns to Education: Accounting for Enrolment and Completion Effects," Melbourne Institute Working Paper Series wp2011n04, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    16. Peter Havlik & Sebastian Leitner & Robert Stehrer, 2012. "Growth Resurgence, Productivity Catching-up and Labour Demand in Central and Eastern European Countries," Chapters, in: Matilde Mas & Robert Stehrer (ed.), Industrial Productivity in Europe, chapter 8, Edward Elgar Publishing.
    17. Charles L. Baum & Christopher J. Ruhm, 2016. "The Changing Benefits of Early Work Experience," Southern Economic Journal, John Wiley & Sons, vol. 83(2), pages 343-363, October.
    18. Claude Diebolt & Bachir El Murr, 2004. "A cobweb model of higher education and labour market dynamics," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 47(3-4), pages 409-430.
    19. Tao, Fang & Liu, Xiaohui & Gao, Lan & Xia, Enjun, 2017. "Do cross-border mergers and acquisitions increase short-term market performance? The case of Chinese firms," International Business Review, Elsevier, vol. 26(1), pages 189-202.
    20. Tan, Clifford, 2013. "The contribution of university rankings to country's GDP per capita," MPRA Paper 53900, University Library of Munich, Germany.

    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:rfa:aefjnl:v:5:y:2018:i:6:p:61-75. 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: Redfame publishing (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    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.