Study On Ability Bias、Education Premium And Wage Differentials In China

Since the nineteen eighties, along with China’s economic growth, People’s income gap including gap in work wages has expanded to become a more prominent issue, which is mainly demonstrated among regions, between urban and rural areas, among industries and the families, even individuals. Therefor, Narrowing the income gap especially the wage disparity has important sense as revitalizing domestic market, breaking the bottleneck of dual economic structure in resolving the deep-seated contradictions in China’s economic growth.This has great significance for realizing the transformation of the mode of economic growth and achieving sustainable growth. It has been put forward clearly to adjust income distribution reasonably, study and formulate the income distribution reform plan and try to reverse the trend of widening income gap in The Party Congress and plenary session of the seventeen Central Committee plenary meeting.The British economist James Edward Meade believes that education is an important investment influencing the individual income, it makes profound indirect effects on income distribution. American economist Paul A. Samuelson also pointed out that, there is no more great steps than education to reducing income inequality. Hao Ru Yu who is a member of the CPPCC National Committee and the vice-president of Capital University of Economics and Business thinks that education is more important means than tax to narrow the gap between the rich and the poor! A large number of domestic and foreign researches show that:education is the one of the important reasons for the widening income gap whether in developed countries or developing countries.Chinese government has always attached great importance to education:The strategic plan to "give priority to the development of education and turn China into a country rich in human resources has been proposed on the17th People’s Congress.It shows that the talent strategy has rosed to be a key national strategy. Education has made considerable progress, by the end of2010, the nine-year compulsory education has been extensively spread in all of the country’s2,856counties (cities, districts), the senior secondary gross enrollment rate reaches to82.5%and26.5%of the gross enrollment rate for higher education, high school education is basically universal in Urban areas, but the rural penetration of high school education in2007, only about50%. According to the Chinese Statistical Yearbook2011:There is the number of6,169,783ordinary junior high school graduates in rural areas, While there is only the number of567141people in the rural, the two account for less than10%. Even though there may be a very small part of the rural junior high school students admitted to the city high school or vocational high schools, technical schools, as well as secondary, yet the proportion of rural junior high school graduates continue their studies are extremely low.Thus with the rapid development of all-levels-education when we consider the mechanism of educational function on wage divide.we are not only concerned about the urban individual whether or not to accept University education but also for rural individual whether to accept a high school education.Since the end of the90s of the last century, Marked by "21st Century Education revitalization plan of action"、"the decision on deepening education reform and promoting quality education" and "the People’s Republic of China Higher Education law" and other relevant policies, all levels of education, especially higher education expands rapidly. Regular higher education enrollment has increased from40.2million in1978to108.4million in1998, an average annual growth rate is8.5%:Particularly, the junior college admissions in1999jumped up to159.7million, representing an increase of47.32%over last year. After high-speed growth rate of16.97%annually until2010, universities and colleges enrollment reached661.7551million the total number of the students reached2231.7929million if we consider network、Specialist、Undergraduate enrollment and graduate enrollment, by the end of2010, the Total enrollment reached to1090.3642million, the total number of students attached to3374.8176million, accounting for18-22years of age nationwide population ratio27.81%. According to American scholar Martin Castro criteria for the classification of the tertiary sector, China has entered the period of popularization of higher education recognized worldwide. The scale of higher education has more than Russia, India and the United States, to become the first in the world. And this expansion continues!Accompanied by the continued expansion of higher education, the relationship between higher education and the labor market has become increasingly intimate. The reasons are as followed:First, with the rapid growth of college students supply, the proportion of the work force who have college academic degree has gradually increased, however at the same time, according to the relevant statistical data among all the unemployed people, the proportion with a university degree has also increased rapidly. So there is a distorted path for education investment to wage income premium. This phenomenon may cause by the followed reasons:First, along with the expansion of higher education, both higher education resource matching lagging and the higher education funding shortage, have led to the decline of the quality of education and the quality of marginal students, all of these will reduce the output efficiency of education investment; Secondly, due to the policy of higher educational expansion as well as the national student loans and other financial support, The structural ability distribution of college students changes. The expansion of higher education results in that more people can receive university education.since June1999, China began to implement the national student loan policy, so that those Who are with poor economic conditions and higher capacity become university students, while it is impossible before. At the same time those who are with lower capacity can also go to university, therefore, before and after the expansion of higher education, the ability distribution between the group with college degree and the group only with senior secondary degree has changed, so that the wages premium of college graduates relative to high school graduates changes partly due to student quality and ability, but not all considered to be premium part. Finally, due to the technological changes of the computer information technology, as well as offshore outsourcing, there has been structural contradictions between the college students supply and the demand.Based on the background of China’s income gap continued to widen, all levels of education, especially higher education Rapid expansion. In the case of structural changes in supply and demand for college students and changes of ability distribution, This paper tries to accurately measure urban university education premium (ie. The wage divide between the workforce who are with college degree and those who are with high school degree) and high school education in rural areas premium, Further excavate the reasons for premium changes deeply. Therefore, this study not only has important reference for the development of the economics of education, labor economics, and wage determination theory, but it can provide a solid theoretical guidance for educational choices for individuals and government to design employment market policy, optimizing the allocation of educational resources for the education sector to provide valuable decision-making reference.Based on the principle of "problem-oriented, allowing the data to speak, making the Advanced measurement methods as a tool, for the purpose of service policy", the paper is divided into eight chapters, which is summarized as follows:Chapter Ⅰ:Introduction:It introduces the Detailed research background, Proposes the problem needed to be solved Elaborates the theoretical significance and practical value Of studying the issue; This chapter launches into an elaborate explanation of research ideas, the scope of the study, research methods, thesis structure, possible innovation and lack.Chapter Ⅱ:This chapter offers the definitions of some concepts-, Theory Model associated with this article and literature review. In particular, it covers the key concepts involved in this paper:the ability and ability bias; premium education and education, as well as wage and wage differences defined and Clarify the theoretical model associated with this article,summarized research status and the entry point of the paper.Chapter Ⅲ:The contribution of higher education to the long-term evolution of wage income structure-based on estimates and decomposition of the Theil index analysis. This chapter is based on the system of CHNS (China Health and Nutrition Survey) which measured the span during the20years1989-2009, the evolution process of individual wage income differences of wage differentials based on Theil index decomposition technique, described in detail in the regional, gender, same cohort, occupational and sectoral differences in the status quo and change in trend, and then carried from the decomposition of the above-mentioned groups and then to the second stage of a college degree and even a multi-stage, multi-angle, multi-dimensional analytic university education expanded form of the wage gap contribution to the process of a deep understanding of the importance of university education, the urgency and necessity of the expansion of education.Chapter Ⅳ:China’s urban university education premium measure based on the propensity score matching model. Taking into account the measurement error of the micro data, sample selection bias, The education premium heterogeneity Theil index decomposition technology limitations, this chapter aims to use the advanced micro-econometric model using propensity score matching model, based on the framework of counterfactual and to use CHIP (Chinese Household Income Project Survey) the dataset2002data, to accurately measure Chinese urban university education premium. The reason why we Choose the data set Is that through the data we can measure University education premium status before the period of the expansion of China’s higher education. More importantly, it contains rich family background information, and can be easy to control the impact On individual ability differences exerted by family genetic factors as well as the family survive environmental factor, in turn, it can more accurately construct counterfactual wage, and the estimate of the specific matching results robustness, we were selected hourly wage, daily wage, monthly salary and annual salary as a result of variable matching method can match the estimated considering the match from the match as well as different radius estimation techniques, and match the design of the different methods by different indicators looking for our university the education premium accurately estimated.Chapter Ⅴ:The impact of the expansionof higher education in China’s university education premium based on the empirical study of the intervention-control framework. The rapid expansion of Chinese higher education occurred in1999, what kind of impact will come after the sudden massive expansion of university education premium, how to evaluate the expansion of higher education in our country? What about the regularity of University of premium expansion evolution? How about the difference of wage quantiles group of university education premium changes? What sort of changes will occur for the expansion of capacity to bias? To Answer these questions requires expansion and rich family background information, while detailed micro data sets, CGSS (China general social survey) micro survey data make our research possible. CGSS earliest investigations.Is in the year of2003, it happens to be the expansion after the first batch of students to enter the labor market period, this chapter, using the latest available data for2006depict out. After Premium shock the expansion of higher education by considering different birth cohorts. If the expansion of higher education in1999can be seen as experiments across the country, this chapter Will analyze the evidence in the intervention -control themining of the experiment based on the framework of the double-difference model (difference-in-differences model, referred to as DID) and quantile estimation techniques and it will bring shocks, and fully take into account the sample selection bias, and educational variables endogeneity, relatively accurate parsing University premium along with the students group at any time period changes in direction and fluctuation. It offers evidences of Empirical University of premium changes from college students supply perspective.Chapter Ⅵ:Empirical test of The presence of the skill biased technological change with China’s panel data from2002-2010based on aggregate production and spatial panel data analysis technology. Based on our enrollment macro data mining from college students demand perspective. This chapter is to analyze the reasons why the changes in university education premium occur. According to Relevant experience learned from international university education premium and technological change argument, This chapter Focus on answering the question about our current national level of technical features rendering skills skewed characteristics. And It will take full account of our region of space-related, theoretically first clarify the connotation of capital-and technology-complementary assumptions, And at the same time it make he use of the total two CES production function, the implementation of spatial panel estimation techniques, respectively estimate the spatial error model and spatial autoregressive model and empirical test My skills partial existence of the state changes in technology, and thus the premium of university education in China is to find convincing evidence of rising demand from the students perspective. The chapter gives the Economic explanation for the difficult employment of current students, high unemployment rate and the fact that from the distribution point.Chapter Ⅶ:Considering the sample selection bias and endogenous education, based on CHIP data and Heckman sample selection model, this chapter estimates the high school education premium in Chinese Countryside, we find that:after controlling for sample selection bias and endogenous education, vocational education, workers average annual income of1.88times is higher than the junior secondary level workers. High school education premium is not significant. Then the Government should increase investment in vocational education, increase subsidies, while matching the survival of the soft environment of vocational education to help farmers out of poverty. So our study can provide tangible reference for the Chinese rural students educational choices.Chapter Ⅷ:research findings, policy recommendations and future outlook. This chapter summarizes the conclusions of the study of the full text, thus corresponding policy recommendations on narrowing income gap from a university education, rural high school education perspective, Finally, the paper provides the prospect for this research.