Signaling or Skill Building? Estimating the Returns to China’s Double First-Class Initiative

Yanli Liu (), Kun Li () and Yanchi Zou ()
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Yanli Liu: Department of Economics, Towson University
Kun Li: School of Economics, Sichuan University
Yanchi Zou: School of Economics, Sichuan University

No 2026-01, Working Papers from Towson University, Department of Economics

Abstract: We estimate the labor-market returns to China’s Double First-Class (DFC) initiative using a difference-in-differences design that exploits discipline-level exposure among newly designated universities. Using university-level salary data from 2012-2021, we find that DFC designation increases graduates’ average monthly salaries by approximately 338 CNY. Event-study estimates reveal an immediate post-announcement increase, consistent with signaling, and larger effects for cohorts with longer exposure, suggesting human-capital accumulation. We find no evidence of institution-wide spillovers or effects for graduates who completed their studies prior to the policy announcement.

Keywords: Double-first class initiative; Labor market; Graduate salaries; Signaling; Human capital accumulation. (search for similar items in EconPapers)
JEL-codes: D82 I23 J31 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2026-03, Revised 2026-03
New Economics Papers: this item is included in nep-cna
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