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Education Development and Wage Inequality in Urban China

Author

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  • Shi Li

    (China Institute of Income Distribution Beijing Normal University 19 Xinjiekouwai Dajie Beijing, China, 100875 Author email: lishi@bnu.edu.cn)

  • ShanshanWu

    (China Institute of Income Distribution Beijing Normal University 19 Xinjiekouwai Dajie Beijing, China, 100875 Author email: wushanshan_bnu@163.com)

  • Chunbing Xing

    (China Institute of Income Distribution Beijing Normal University 19 Xinjiekouwai Dajie Beijing, China, 100875 Author email: xingchb@bnu.edu.cn)

Abstract

Using a representative household survey for 1995, 2002, 2007, and 2013, we show that education plays a pivotal role in shaping wage inequality in urban China. We find that education was a major contributor to increased wage inequality between 1995 and 2013. The returns to education remained high after 2007 despite a large inflow of college-educated workers. Although regional wage inequality declined from 200713, regional wage inequality among educated workers did not. Residual wage inequality increased, and the within inequality of educated workers increased faster than that of the less educated. We argue that China's education expansion seems insufficient to narrow the educational wage gap, and a lack of labor mobility for educated workers prevents the decline in returns to education in specific regions.

Suggested Citation

  • Shi Li & ShanshanWu & Chunbing Xing, 2018. "Education Development and Wage Inequality in Urban China," Asian Economic Papers, MIT Press, vol. 17(2), pages 140-151, Summer.
    • Handle: RePEc:tpr:asiaec:v:17:y:2018:i:2:p:140-151
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    References listed on IDEAS

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    Cited by:

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    2. Xing, Chunbing & Sun, Yan, 2019. "Economic Opportunities and Gender Equity: The Migration and Education Decisions of Young Women from Rural China," IZA Discussion Papers 12311, Institute of Labor Economics (IZA).
    3. Xing, Chunbing & Yuan, Xiaoyan & Zhang, Junfu, 2022. "City size, family migration, and gender wage gap: Evidence from rural–urban migrants in China," Regional Science and Urban Economics, Elsevier, vol. 97(C).
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    5. Ichiro Iwasaki & Xinxin Ma, 2020. "Gender wage gap in China: a large meta-analysis," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 54(1), pages 1-19, December.
    6. Xinxin Ma & Ichiro Iwasaki, 2021. "Return to schooling in China: a large meta-analysis," Education Economics, Taylor & Francis Journals, vol. 29(4), pages 379-410, July.
    7. Iwasaki, Ichiro & Ma, Xinxin, 2020. "Gender Wage Gap in China: A Large Meta-Analysis," CEI Research Paper Series 2020-5, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    8. Wai Choi Lee & Tsun Se Cheong & Yanrui Wu & Jianxin Wu, 2019. "The Impacts of Financial Development, Urbanization, and Globalization on Income Inequality: A Regression-based Decomposition Approach," Asian Economic Papers, MIT Press, vol. 18(2), pages 126-141, Summer.
    9. Yanan Li & Chunbing Xing, 2020. "Structural transformation, inequality, and inclusive growth in China," WIDER Working Paper Series wp-2020-33, World Institute for Development Economic Research (UNU-WIDER).

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