IDEAS home Printed from https://ideas.repec.org/a/bla/manchs/v91y2023i4p283-305.html
   My bibliography  Save this article

Local education expenditures and educational inequality in China

Author

Listed:
  • Jianyong Fan
  • Jian Huang
  • John G. Sessions
  • Jingjing Ye

Abstract

We investigate the relationship between education funding and educational inequality across Chinese prefectures. The decentralisation of education in China has created substantial variations in government educational expenditures, both over time and across regions. We propose that these variations relate to the budget preferences of local governors. These are age dependent with younger officials more inclined to invest in large and quantifiable infrastructure projects rather than public service provision. This provides a source of exogenous variation in local fiscal efforts to provide public education and thus permits quasi‐experimental evaluation through instrumental variable identification. Our results suggest that increased education spending is linked with lower educational inequality. Moreover, we find strong evidence of heterogeneity ‐ the magnitude of the effect is diminishing with the degree of local fiscal autonomy.

Suggested Citation

  • Jianyong Fan & Jian Huang & John G. Sessions & Jingjing Ye, 2023. "Local education expenditures and educational inequality in China," Manchester School, University of Manchester, vol. 91(4), pages 283-305, July.
    • Handle: RePEc:bla:manchs:v:91:y:2023:i:4:p:283-305
    DOI: 10.1111/manc.12435
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/manc.12435
    Download Restriction: no
    File URL: https://libkey.io/10.1111/manc.12435?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Zhuo Chen & Mingzhi Hu & Zhiyi Qiu, 2022. "Promotion Pressures of Local Leaders and Real Estate Investments: China and Leader Heterogeneity," JRFM, MDPI, vol. 15(8), pages 1-14, August.
    2. Kam Wing Chan, 2010. "The Household Registration System and Migrant Labor in China: Notes on a Debate," Population and Development Review, The Population Council, Inc., vol. 36(2), pages 357-364, June.
    3. Ting Chen & James Kai-sing Kung & Chicheng Ma, 2020. "Long Live Keju! The Persistent Effects of China’s Civil Examination System," The Economic Journal, Royal Economic Society, vol. 130(631), pages 2030-2064.
    4. Park, Kang H., 1996. "Educational expansion and educational inequality on income distribution," Economics of Education Review, Elsevier, vol. 15(1), pages 51-58, February.
    5. Julien Lafortune & Jesse Rothstein & Diane Whitmore Schanzenbach, 2018. "School Finance Reform and the Distribution of Student Achievement," American Economic Journal: Applied Economics, American Economic Association, vol. 10(2), pages 1-26, April.
    6. Naughton, Barry, 2016. "Inside and outside: The modernized hierarchy that runs China," Journal of Comparative Economics, Elsevier, vol. 44(2), pages 404-415.
    7. C. Kirabo Jackson & Rucker C. Johnson & Claudia Persico, 2016. "The Effects of School Spending on Educational and Economic Outcomes: Evidence from School Finance Reforms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(1), pages 157-218.
    8. Anne Villamil & Xiaobing Wang & Ning Xue, 2021. "A political foundation of public investment and welfare spending," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 23(4), pages 660-690, August.
    9. Li, Hongbin & Zhou, Li-An, 2005. "Political turnover and economic performance: the incentive role of personnel control in China," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1743-1762, September.
    10. Thomas, Vinod & Wang, Yan & Fan, Xibo, 2001. "Measuring education inequality - Gini coefficients of education," Policy Research Working Paper Series 2525, The World Bank.
    11. Constantin Manuel Bosancianu, 2017. "A Growing Rift in Values? Income and Educational Inequality and Their Impact on Mass Attitude Polarization," Social Science Quarterly, Southwestern Social Science Association, vol. 98(5), pages 1587-1602, November.
    12. Yuan, Cheng & Zhang, Lei, 2015. "Public education spending and private substitution in urban China," Journal of Development Economics, Elsevier, vol. 115(C), pages 124-139.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simona Ferraro & Tommaso Agasisti & Francesco Porcelli & Mara Soncin, 2021. "Local governments’ efficiency and educational results: empirical evidence from Italian primary schools," Applied Economics, Taylor & Francis Journals, vol. 53(35), pages 4017-4039, July.
    2. Manon Garrouste & Miren Lafourcade, 2022. "Place-Based Policies: Opportunity for Deprived Schools or Zone-and-Shame Effect?," Post-Print hal-04329793, HAL.
    3. Eric A. Hanushek & Jacob D. Light & Paul E. Peterson & Laura M. Talpey & Ludger Woessmann, 2022. "Long-run Trends in the U.S. SES-Achievement Gap," Education Finance and Policy, MIT Press, vol. 17(4), pages 608-640, Fall.
    4. María Orduz, 2022. "Effect of educational spending on academic performance under different institutional arrangements," Documentos CEDE 20224, Universidad de los Andes, Facultad de Economía, CEDE.
    5. Ridley, Matthew & Terrier, Camille, 2018. "Fiscal and education spillovers from charter school expansion," LSE Research Online Documents on Economics 91700, London School of Economics and Political Science, LSE Library.
    6. Xie, Xiaoxia & Huang, Chien-Chung & Chen, Yafan & Hao, Feng, 2019. "Intelligent robots and rural children," Children and Youth Services Review, Elsevier, vol. 100(C), pages 283-290.
    7. Cécile Bonneau, 2020. "The Concentration of investment in education in the US (1970-2018)," Working Papers halshs-02875965, HAL.
    8. Asker, Erdal & Brunner, Eric & Ross, Steve, 2024. "JUE insight: The impact of school spending on civic engagement: Evidence from school finance reforms," Journal of Urban Economics, Elsevier, vol. 143(C).
    9. Cordis, Adriana S. & Muzatko, Steven, 2021. "Higher education spending and CPA exam performance," Journal of Accounting Education, Elsevier, vol. 55(C).
    10. Haiwen Zhou, 2023. "State Capacity and Leadership: Why Did China Take off?," Chinese Economy, Taylor & Francis Journals, vol. 56(1), pages 50-68, January.
    11. Michah W. Rothbart, 2020. "Does School Finance Reform Reduce the Race Gap in School Funding?," Education Finance and Policy, MIT Press, vol. 15(4), pages 675-707, Fall.
    12. Shazia Kousar & Farhan Ahmed & Muhammad Afzal & Juan E. Trinidad Segovia, 2023. "Is government spending in the education and health sector necessary for human capital development?," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-11, December.
    13. Ann Owens & Jennifer Candipan, 2019. "Social and spatial inequalities of educational opportunity: A portrait of schools serving high- and low-income neighbourhoods in US metropolitan areas," Urban Studies, Urban Studies Journal Limited, vol. 56(15), pages 3178-3197, November.
    14. Danielle V. Handel & Eric A. Hanushek, 2024. "Contexts of Convenience: Generalizing from Published Evaluations of School Finance Policies," Evaluation Review, , vol. 48(3), pages 461-494, June.
    15. Andrés Rodríguez‐Pose & Vassilis Tselios, 2009. "Education And Income Inequality In The Regions Of The European Union," Journal of Regional Science, Wiley Blackwell, vol. 49(3), pages 411-437, August.
    16. David J. Deming & Christopher R. Walters, 2017. "The Impact of Price Caps and Spending Cuts on U.S. Postsecondary Attainment," NBER Working Papers 23736, National Bureau of Economic Research, Inc.
    17. Enami, Ali & Alm, James & Aranda, Rodrigo, 2021. "Labor versus capital in the provision of public services: Estimating the marginal products of inputs in the production of student outcomes✰," Economics of Education Review, Elsevier, vol. 83(C).
    18. Hanushek, Eric A. & Peterson, Paul E. & Talpey, Laura M. & Woessmann, Ludger, 2019. "The Unwavering SES Achievement Gap: Trends in U.S. Student Performance," Working Paper Series rwp19-012, Harvard University, John F. Kennedy School of Government.
    19. Chauvin, Juan Pablo, 2024. "Local Education Spending and Migration: Evidence from a Large Redistribution Program," IDB Publications (Working Papers) 13497, Inter-American Development Bank.
    20. Huang, Liangxiong & Ma, Minghui & Wang, Xianbin, 2022. "Clan culture and risk-taking of Chinese enterprises," China Economic Review, Elsevier, vol. 72(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:manchs:v:91:y:2023:i:4:p:283-305. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/semanuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.