Tuition Fees for Higher Education and Intergenerational Mobility in China

Yuanyuan Chen (), Quanlin Liu and Kun Wu
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Yuanyuan Chen: Institute for Advanced Research, and Key Laboratory of Mathematical Economics of Ministry of Education, Shanghai University of Finance and Economics, Shanghai 200433, China
Quanlin Liu: School of Economics, Shanghai University of Finance and Economics, Shanghai 200433, China
Kun Wu: School of Economics, Shanghai University of Finance and Economics, Shanghai 200433, China

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2020, vol. 15, issue 3, 396-432

Abstract: This paper studies the impact of an increase in higher education tuition on intergenerational mobility in China. We develop a theoretical model for the parental decision about the investment on education of children to illustrate the impact from the perspective of borrowing constraint. We consider the Chinese college tuition and subsidy reform around 1986 as a quasi-natural experiment for identifying the policy effect of the reform on intergenerational educational mobility by using the data from the census of 2000 and the China Family Panel Studies (CFPS). We find that an increase in the education burden induced by the reform of college tuition has reduced intergenerational educational mobility, and it is more noticeable in regions with a relatively higher increment in the tuition fee. Our results are robust with consideration of the co-residence bias, government investment in elementary education, and the higher education expansion.

Keywords: tuition fees of higher education; intergenerational educational mobility; reform of college tuition and subsidy; co-residence bias; borrowing constraint (search for similar items in EconPapers)
JEL-codes: I21 I28 J62 (search for similar items in EconPapers)
Date: 2020
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