Research On The Personal Education Investment Profits And Risks In China

As an important part of human capital investment, personal investment in education can affect both individual investors and also the harmonious development of society.The study on individual’s education investment can not only measure the contribution of education to the development of the economy and the efficiency of the resources, but also reveal the influence of education on income distribution and the efficiency of labor disposition. In a personal view, most of the personal education investment is intergenerational behavior for a long time, there are not only income factors but also some complex emotional factors influence people that make they ignore the risks when they make the education investment decision. This thesis comprehensively analysed the benefits and risks of personal education investment, provided a new perspective of the education investment.This thesis is mainly a positive study. On the basis of the reviewing the present literature on rate of return to education (RRE), estimates the personal Mincerian RRE using the1989-2009CHNS microeconomic survey data, with the OLS and Quintile Regression (RS) model. Besides, this thesis estimates the risk of personal education investment by the results of RS model. With the result of estimation, we can study the overall level, the dynamic trends and internal characteristics of the education investment. This thesis offers a result which reflects China’s recent return to education and with this result it offers some suggestions on how to modify the labor market mechanism.The results show that the level of RRS in China during1989-2009generally maintained an upward trend, and there are still disparities between different regions, ownership, gender and education level. Same as the other type of investment, the high RRS is often accompanied by high risks. Women and rural samples tend to get a higher level of risk, state-owned enterprises have the lower risk. The risk of investment is higher than other education phase and it continue to rise after2000. Based on the results of empirical analysis, this thesis proposes a series of rationalization policy recommendations, such as optimizing the allocation of educational resources, promoting the reform of the labor market mechanism, accelerate the economic and educational structural adjustment.