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Changes in returns to education for off-farm wage employment: evidence from rural China

Author

Listed:
  • Weidong Wang
  • Yongqing Dong
  • Renfu Luo
  • Yunli Bai
  • Linxiu Zhang

Abstract

Purpose - The purpose of this paper is to examine the role of education in the labor market and to understand how returns to education change over time in rural China. Design/methodology/approach - Using nationally representative survey data from 2004 to 2015, this study provides insights on wage determination in the labor market and examines how the returns to education in rural China differ with time and educational endowment. This study applies ordinary least squares estimation and the Heckman selection model to estimate the returns to education. Findings - The returns to education decreased during the observed years from more than 6 percent in 2004 to only about 3 percent in 2011, rising to nearly 4 percent in 2015. The overall trend is robust and observed within groups defined by education. Additionally, the returns to education vary greatly with educational endowment. Tertiary education has always maintained a high rate of returns at nearly 10 percent, while returns to senior high school education and below have gradually diminished. Originality/value - The authors believe that the results will not only enrich studies on the returns to education in rural China, but also provide a basis for diagnosing the changes of rural labor market in the early twenty-first century.

Suggested Citation

  • Weidong Wang & Yongqing Dong & Renfu Luo & Yunli Bai & Linxiu Zhang, 2018. "Changes in returns to education for off-farm wage employment: evidence from rural China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 11(1), pages 2-19, July.
    • Handle: RePEc:eme:caerpp:caer-05-2017-0098
    DOI: 10.1108/CAER-05-2017-0098
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    Citations

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    Cited by:

    1. Ichiro Iwasaki & Xinxin Ma, 2020. "Gender wage gap in China: a large meta-analysis," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 54(1), pages 1-19, December.
    2. Iwasaki, Ichiro & Ma, Xinxin, 2020. "Gender Wage Gap in China: A Large Meta-Analysis," CEI Research Paper Series 2020-5, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    3. Weidong Wang & Yongqing Dong & Yunli Bai & Renfu Luo & Linxiu Zhang & Chengfang Liu & Spencer Hagist, 2020. "Returns to Education in Different Job Locations for Off-Farm Wage Employment: Evidence from China," Sustainability, MDPI, vol. 12(2), pages 1-14, January.
    4. Wang, Weidong & Dong, Yongqing & Liu, Xiaohong & Bai, Yunli & Zhang, Linxiu, 2020. "The effect of parents’ education on the academic and non-cognitive outcomes of their children: Evidence from China," Children and Youth Services Review, Elsevier, vol. 117(C).
    5. Dingde Xu & Zhixing Ma & Xin Deng & Yi Liu & Kai Huang & Wenfeng Zhou & Zhuolin Yong, 2020. "Relationships between Land Management Scale and Livelihood Strategy Selection of Rural Households in China from the Perspective of Family Life Cycle," Land, MDPI, vol. 9(1), pages 1-15, January.
    6. Weidong Wang & Yongqing Dong & Xiaohong Liu & Linxiu Zhang & Yunli Bai & Spencer Hagist, 2018. "The More Educated, the Healthier: Evidence from Rural China," IJERPH, MDPI, vol. 15(12), pages 1-14, December.
    7. Yunli Bai & Fang Bian & Linxiu Zhang & Yueming Cao, 2020. "The Impact of Social Support on the Health of the Rural Elderly in China," IJERPH, MDPI, vol. 17(6), pages 1-18, March.

    More about this item

    Keywords

    Returns to education; Off-farm wage employment; Rural labour market; I2; J24; J31;
    All these keywords.

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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