Fiscal Decentralisation, the Knowledge Economy and School Teachers’ Wages in Urban China

Yi Long, Chris Nyland and Russell Smyth

No 13-16, Monash Economics Working Papers from Monash University, Department of Economics

Abstract: We examine how fiscal decentralisation and progress towards the development of a knowledge-intensive economy has impacted on teachers’ wages in China, utilising a panel dataset of 31 provincial administrations from 2001 to 2013. We find that fiscal decentralisation has a negative impact on teachers’ wages and this effect is further enhanced by a deepening of the knowledge intensity of the economy, while knowledge economy itself has no significant impact on teachers’ wages. The findings suggest that incentives being offered to local administrators need to be revisited if the national government is convinced of the need to increase teacher quality in ways suited to the knowledge economy China wishes to construct.

Keywords: fiscal decentralisation; knowledge economy; teachers; wages; human capital; China (search for similar items in EconPapers)
JEL-codes: H73 J31 J45 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2016-11
New Economics Papers: this item is included in nep-cna, nep-edu, nep-knm, nep-tra and nep-ure
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