IDEAS home Printed from https://ideas.repec.org/a/eee/chieco/v82y2023ics1043951x23001566.html
   My bibliography  Save this article

The impact of education on relative poverty and its intergenerational transmission —— Causal identification based on the Compulsory Education Law

Author

Listed:
  • Zuo, Hong
  • Li, Shi
  • Ge, Zhenyu
  • Chen, Jialu

Abstract

Using data from the Chinese General Social Survey (CGSS) and the China Statistical Yearbook, we explore a “quasi-natural experiment” made possible by the enactment of China's 1986 Compulsory Education Law to study the causal relationship between education and decrease in the incidence of relative poverty, as well as that between education and decrease in the intergenerational transmission of relative poverty. By applying a difference-in-differences estimation, we find the following: i. The probability of the offspring experiencing relative poverty decreases by 6–8% as the duration of their eligibility for compulsory education increases by 1 semester; education can block the intergenerational transmission of relative poverty. ii. The effects of education on reducing the incidence of relative poverty and blocking the intergenerational transmission of relative poverty are found mainly in rural areas and among female groups, while no significant effect is found in urban areas and among male groups. iii. High school graduation, labor market performance, and effort are three paths through which education reduces the incidence of relative poverty and blocks its intergenerational transmission.

Suggested Citation

  • Zuo, Hong & Li, Shi & Ge, Zhenyu & Chen, Jialu, 2023. "The impact of education on relative poverty and its intergenerational transmission —— Causal identification based on the Compulsory Education Law," China Economic Review, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:chieco:v:82:y:2023:i:c:s1043951x23001566
    DOI: 10.1016/j.chieco.2023.102071
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1043951X23001566
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.chieco.2023.102071?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. Shi, Xinzheng, 2012. "Does an intra-household flypaper effect exist? Evidence from the educational fee reduction reform in rural China," Journal of Development Economics, Elsevier, vol. 99(2), pages 459-473.
    2. Helena Holmlund & Mikael Lindahl & Erik Plug, 2011. "The Causal Effect of Parents' Schooling on Children's Schooling: A Comparison of Estimation Methods," Journal of Economic Literature, American Economic Association, vol. 49(3), pages 615-651, September.
    3. Xiao, Yun & Li, Li & Zhao, Liqiu, 2017. "Education on the cheap: The long-run effects of a free compulsory education reform in rural china," Journal of Comparative Economics, Elsevier, vol. 45(3), pages 544-562.
    4. Menggen Chen & Yan Wang & D. S. Prasada Rao, 2020. "Measuring the spatial price differences in China with regional price parity methods," The World Economy, Wiley Blackwell, vol. 43(4), pages 1103-1146, April.
    5. Lockheed, Marlaine E & Jamison, Dean T & Lau, Lawrence J, 1980. "Farmer Education and Farm Efficiency: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 29(1), pages 37-76, October.
    6. Fosu, Augustin Kwasi, 2017. "Growth, inequality, and poverty reduction in developing countries: Recent global evidence," Research in Economics, Elsevier, vol. 71(2), pages 306-336.
    7. Atsushi Inoue & Gary Solon, 2010. "Two-Sample Instrumental Variables Estimators," The Review of Economics and Statistics, MIT Press, vol. 92(3), pages 557-561, August.
    8. Brandt, Loren & Holz, Carsten A, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 43-86, October.
    9. Robert Joyce & James P. Ziliak, 2019. "Relative Poverty in Great Britain and the United States, 1979–2017," Fiscal Studies, John Wiley & Sons, vol. 40(4), pages 485-518, December.
    10. Gustafsson, Björn Anders & Sai, Ding, 2019. "Growing into Relative Income Poverty: Urban China 1988 to 2013," IZA Discussion Papers 12422, Institute of Labor Economics (IZA).
    11. Guo, Junping & Qu, Song & Zhu, Tiehui, 2022. "Estimating China’s relative and multidimensional Poverty: Evidence from micro-level data of 6145 rural households," World Development Perspectives, Elsevier, vol. 26(C).
    12. Can Tang & Liqiu Zhao & Zhong Zhao, 2020. "Does free education help combat child labor? The effect of a free compulsory education reform in rural China," Journal of Population Economics, Springer;European Society for Population Economics, vol. 33(2), pages 601-631, April.
    13. Hannum, Emily & Wang, Meiyan, 2006. "Geography and educational inequality in China," China Economic Review, Elsevier, vol. 17(3), pages 253-265.
    14. Luigi Biggeri & Guido Ferrari & Yanyun Zhao, 2017. "Estimating Cross Province and Municipal City Price Level Differences in China: Some Experiments and Results," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 131(1), pages 169-187, March.
    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. Chen, Yuanyuan & Wang, Haining & Cheng, Zhiming & Smyth, Russell, 2023. "Education and Migrant Health in China," Economic Modelling, Elsevier, vol. 121(C).
    2. Yongwei Chen & Ying Zhang, 2020. "Effects of free compulsory education on rural well‐being in China," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 34(2), pages 78-92, November.
    3. Sun, Yue & Zhao, Liqiu & Zhao, Zhong, 2024. "Hukou Status and Children's Education in China," IZA Discussion Papers 16763, Institute of Labor Economics (IZA).
    4. Can Tang & Liqiu Zhao & Zhong Zhao, 2020. "Does free education help combat child labor? The effect of a free compulsory education reform in rural China," Journal of Population Economics, Springer;European Society for Population Economics, vol. 33(2), pages 601-631, April.
    5. Menggen Chen & Yan Wang & D. S. Prasada Rao, 2020. "Measuring the spatial price differences in China with regional price parity methods," The World Economy, Wiley Blackwell, vol. 43(4), pages 1103-1146, April.
    6. Amita Majumder & Ranjan Ray, 2020. "National and subnational purchasing power parity: a review," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 47(2), pages 103-124, June.
    7. Cui, Ying & Liu, Hong & Zhao, Liqiu, 2019. "Mother's education and child development: Evidence from the compulsory school reform in China," Journal of Comparative Economics, Elsevier, vol. 47(3), pages 669-692.
    8. Zhao, Liqiu & Wang, Fei & Zhao, Zhong, 2021. "Trade liberalization and child labor," China Economic Review, Elsevier, vol. 65(C).
    9. Ã lvaro Choi, 2023. "The Impact of Compulsory Schooling Expansion on Educational Outcomes: The Case of Indonesia," UB School of Economics Working Papers 2023/452, University of Barcelona School of Economics.
    10. Chunyun Wang & Xiaoxi Yu & Jiang Zhao, 2022. "Identifying the Real Income Disparity in Prefecture-Level Cities in China: Measurement of Subnational Purchasing Power Parity Based on the Stochastic Approach," Sustainability, MDPI, vol. 14(16), pages 1-24, August.
    11. Menggen Chen, 2021. "Sub-National PPPs Based on House and Real Income Disparity across China: a Distinctive Spatial Deflator," The Journal of Real Estate Finance and Economics, Springer, vol. 62(2), pages 187-219, February.
    12. Markus Jäntti & Stephen P. Jenkins, 2013. "Income Mobility," SOEPpapers on Multidisciplinary Panel Data Research 607, DIW Berlin, The German Socio-Economic Panel (SOEP).
    13. Petr Jansk & Marek ediv, 2018. "How Do Regional Price Levels Affect Income Inequality? Household-level Evidence From 21 Countries," LIS Working papers 752, LIS Cross-National Data Center in Luxembourg.
    14. Zhou, Lei & Jiang, Bo & Wang, Jingxi, 2020. "Do cash transfers have impacts on student Academic, cognitive, and enrollment outcomes? Evidence from rural China," Children and Youth Services Review, Elsevier, vol. 116(C).
    15. Martina Menon & Federico Perali & Ranjan Ray & Nicola Tommasi, 2019. "The Tale of the Two Italies: Regional Price Parities Accounting for Differences in the Quality of Services," Working Papers 20/2019, University of Verona, Department of Economics.
    16. Tang, Can & Zhao, Liqiu & Zhao, Zhong, 2019. "Free Education Helps Combat Child Labor? The Effect of a Free Compulsory Education Reform in Rural China," IZA Discussion Papers 12374, Institute of Labor Economics (IZA).
    17. Tani, Massimiliano & Xu, Lei & Zhu, Yu, 2021. "The impact of an un(der)funded inclusive education policy: Evidence from the 2013 China education panel survey," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 768-784.
    18. Ding, Yanqing & Lu, Fengming & Ye, Xiaoyang, 2020. "Intergovernmental transfer under heterogeneous accountabilities: The effects of the 2006 Chinese Education Finance Reform," Economics of Education Review, Elsevier, vol. 77(C).
    19. Tang, Le & Sun, Shiyu & Yang, Weiguo, 2021. "Investments in human capital: The evidence from China’s new rural pension scheme," Research in International Business and Finance, Elsevier, vol. 55(C).
    20. Fang Guanfu & Chen Yu, 2021. "Sibling Rivalry: Evidence from China’s Compulsory Schooling Reform," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(2), pages 611-656, April.

    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:chieco:v:82:y:2023:i:c:s1043951x23001566. 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/chieco .

    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.