Human capital investment in children: An empirical study of household child education expenditure in China, 2007 and 2011

Wei Chi () and Xiaoye Qian

China Economic Review, 2016, vol. 37, issue C, 52-65

Abstract: Household education expenditure is an important component of human capital investment in children. In China, the rising child education expenditure and the subsequent financial burden on families have attracted much research and policy attention in the recent years. Using 2007 and 2011 data from the Urban Household Education Surveys, our empirical study provides new evidence on the education expenditure level, ratio of expenditure to household income, and inequality in this expenditure. We also elucidate changes in China's household education expenditure and explore factors associated with such changes. From the analysis, we obtain the following findings. First, education expenditure incurred outside the school significantly contributes to increasing household education expenditure. Second, compulsory education programs are effective in curbing in-school education expenditure; however, it does not prevent the rapidly increasing education investment outside school. Third, education expenditure disproportionally increases with family income. In other words, a larger share of the income earned by lower income families is spent on children's education, compared to higher income families.

Keywords: Human capital investment; Child education expenditure; Out-of-school expenditure; Compulsory education policy (search for similar items in EconPapers)
JEL-codes: I21 I23 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (39)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:37:y:2016:i:c:p:52-65

DOI: 10.1016/j.chieco.2015.11.008

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