Education's role in China's structural transformation
Soohyung Lee and
No 2009-41, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)
We explore education's role in improving the allocation of labor between China's agricultural and nonagricultural sectors and measure the portion of China's recent growth attributable to this channel. Building from micro-level estimates, we find that education's impact on labor reallocation between sectors accounts for about 9 percent of Chinese growth, whereas its impact on within-sector human capital growth explains only 2 percent. Our findings suggest that, when frictions cause large productivity gaps across sectors and returns to education are greater in higher-productivity sectors, education policy may be a useful tool for increasing efficiency.
Keywords: Education; -; Economic; aspects (search for similar items in EconPapers)
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Journal Article: Education's role in China's structural transformation (2013)
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