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Sorting, Selection, and Transformation of Return to College Education in China

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  • Belton M Fleisher

    ()
    (Department of Economics, Ohio State University)

  • Haizheng Li

    (Georgia Tech)

  • Shi Li

    (Chinese Academy of Social Sciences)

  • Xiaojun Wang

    ()
    (Department of Economics, University of Hawaii at Manoa)

Abstract

We estimate selection and sorting effects on the evolution of the private return to schooling for college graduates during China’s reform between 1988 and 2002. We find evidence of substantial sorting gains under the traditional system, but gains have diminished and even become negative in the most recent data. We take this as evidence consistent with the growing influence of private financial constraints on decisions to attend college as tuition costs have risen and the relative importance of government subsidies to higher education has declined.

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File URL: http://www.economics.hawaii.edu/research/workingpapers/WP_05-7.pdf
File Function: First version, 2004
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Bibliographic Info

Paper provided by University of Hawaii at Manoa, Department of Economics in its series Working Papers with number 200507.

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Length: 26 pages
Date of creation: 2005
Date of revision:
Handle: RePEc:hai:wpaper:200507

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Keywords: return to schooling; sorting gains; heterogeneity; financial constraints; comparative advantage; China;

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References

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  1. Carneiro, Pedro & Heckman, James J., 2002. "The Evidence on Credit Constraints in Post-Secondary Schooling," IZA Discussion Papers 518, Institute for the Study of Labor (IZA).
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  5. Orazem, Peter F. & Vodopivec, Milan, 1994. "Winners and losers in transition : returns to education, experience, and gender in Slovenia," Policy Research Working Paper Series 1342, The World Bank.
  6. Fleisher, Belton M. & Wang, Xiaojun, 2001. "Efficiency Wages and Work Incentives in Urban and Rural China," Journal of Comparative Economics, Elsevier, vol. 29(4), pages 645-662, December.
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  12. Belton M. Fleisher & Klara Sabirianova Peter & Xiaojun Wang, 2004. "Returns to Skills and the Speed of Reforms: Evidence from Central and Eastern Europe, China, and Russia," William Davidson Institute Working Papers Series 2004-703, William Davidson Institute at the University of Michigan.
  13. Li, Haizheng, 2003. "Economic transition and returns to education in China," Economics of Education Review, Elsevier, vol. 22(3), pages 317-328, June.
  14. Bjorklund, Anders & Moffitt, Robert, 1987. "The Estimation of Wage Gains and Welfare Gains in Self-selection," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 42-49, February.
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  17. Meng,Xin, 2009. "Labour Market Reform in China," Cambridge Books, Cambridge University Press, number 9780521121118, April.
  18. Fleisher, Belton M. & Wang, Xiaojun, 2005. "Returns to schooling in China under planning and reform," Journal of Comparative Economics, Elsevier, vol. 33(2), pages 265-277, June.
  19. Hannum, Emily & Wang, Meiyan, 2006. "Geography and educational inequality in China," China Economic Review, Elsevier, vol. 17(3), pages 253-265.
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Cited by:
  1. Messinis, George, 2013. "Returns to education and urban-migrant wage differentials in China: IV quantile treatment effects," China Economic Review, Elsevier, vol. 26(C), pages 39-55.
  2. CHEN, Guifu & HAMORI, Shigeyuki, 2009. "Economic returns to schooling in urban China: OLS and the instrumental variables approach," China Economic Review, Elsevier, vol. 20(2), pages 143-152, June.

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