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Free Education and the Intergenerational Transmission of Cognitive Skills in Rural China

Author

Listed:
  • Zheyuan Zhang

    (Capital University of Economics and Business)

  • Hui Xu

    (Beijing Normal University)

  • Ruilin Liu

    (Capital University of Economics and Business)

  • Zhong Zhao

    (Renmin University of China)

Abstract

This paper estimates the impact of the Free Education Policy, a major education reform implemented in rural China in 2006, as a natural experiment on the intergenerational transmission of cognitive skills. The identification strategy relies on a difference-in-differences approach and exploits the fact that the reform was implemented gradually at different times across different provinces. By utilizing nationally representative data from the China Family Panel Studies, we find that an additional semester of exposure to the Free Education Policy reduces the intergenerational transmission of parent and child cognitive scores by an approximately 1% standard deviation in rural China, indicating a reduction of 3.5% in intergenerational cognitive persistence. The improvement in cognitive mobility across generations might be attributed to enhanced school attainment, the relaxation of budget constraints, and increased social contact for children whose parents are less advantaged in terms of cognitive skills.

Suggested Citation

  • Zheyuan Zhang & Hui Xu & Ruilin Liu & Zhong Zhao, 2024. "Free Education and the Intergenerational Transmission of Cognitive Skills in Rural China," Working Papers 2024-017, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2024-017
    Note: MIP
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    File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/Zhang_Xu_Liu_etal_2024_free-ed-intergen-trans-cog-skill-china.pdf
    File Function: First version, September, 2024
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    Keywords

    Free Education policy; intergenerational transmission; cognitive skills;
    All these keywords.

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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