The Comparison Of Regional Disparity Of Returns To Education In China-an Empirical Study Based On Chip Data

Under the Chinese Economic Reform,the socialist market economy with Chinese characteristics has been thriving since the 1980s due to the high growth rate in terms of GDP and gradually declining poverty rate.However,giving the objective factors,such as the nature condition in different regions of China(i.e.the east,the middle,and the west)and the different policies of governments,the income inequality of residents within these regions are increasingly significant.Under this economic background,domestic labor economists focus more on the relationship between the investment in human capital and the income distribution.In addition,the balance of human capital in terms of its quantity and quality has always been a trending social topic due to the huge population in China.Moreover,the relationship between the educational development and the income inequality depends on the combined results of structure effect and wage effect in the education expansion.Consequently,this thesis focus on the impact of Chinese education development on the income of residents in different regions of china(east/middle/west),the relationship between education and income,and whether the regional income inequality could be reduced by education in the long run.Based on the established theory of human capital and income distribution,the researcher glance over the theory accomplishments by scholars regarding the impact of education on the income distribution.Then the author summarizes the current situation of Chinese education development and the income distribution,and estimates the domestic return rate on education both in overall and in different education level in the 21st century by taking the empirical analysis based on the CHIP data in latest three years.The model is constructed by extending and modifying the Mincer income equation.This thesis includes the comparable analysis of the different return rate in overall and structural level and the calculation of return rate in different income quantile as well as the detailed analysis of the impact of education on the interregional income imbalance.In the end,the author will make a conclusion on the impact of education development level on the regional income inequality in China,and raise some relevant suggested measures.The main contributions are the following:the latest three years of the CHIP data are used in the empirical study.The trend of educational rate of return in the east,middle and west regions of china are analyzed and compared.Likewise,the Quantile Regression with different income classes in reach region.In addition to considering the years of personal education,the impact of the years of work on income is measured.Moreover,the control variables such as gender,work unit type,industry,which divided into sub-control variables,are mentioned to ensure that this Empirical research is more scientific and rigorous.It can be concluded that the education years and individual income apparently has a positive correlation.According to the overall analysis,the average return rate on Education in the east region is higher than the middle and west regions in the recent years and the gap is starting to be wide.The return rate in the middle region tends to drop back.According to the structural analysis,the east has the highest return rate in both terms of the elementary and middle schools and higher education.Within the east and middle regions,the return rate of higher education is much higher than the elementary and middle schools.However,the return rate in the west is on the contrary.Furthermore,the Quantile Regression Results of interregional return rate shows that there is a certain difference between different wage earners within the east,middle and west regions in terms of the overall return rate on education.Among which,the lower wage earners in west regions have higher return rate than higher wage earners have.Accordingly,this research recommends that the government may continue to increase the input of basic education and expand secondary education.However,they may appropriately reduce the development of higher education and optimize the development of regional industrial structure.Moreover,education investment policy in west region may be inclined to low-income families.