The Human-capitalEffect And Signaling Effect Of English Skills: From Theperspective Of Screening Theory

China's English education has been running a policy-driven fever since it has been confirmed that decent job market outcomes are correlated with one's English proficiency.Also residents' overall English competence is regarded as critical productive characteristics of a country in transnational trades.Nevertheless,irrational English over-education would not only be reduced to a waste of time and money for both individuals for families and individuals,but would disturb investment decision on English skills for the wholegroup of educates.With implementation of reform on English subject in China's college entrance exam,investment in English skills comes to be a trade-off as there are public opinions for "reducing students' load on English subject".Focusing on this problem,this thesis proposes to discuss economic function of English skills on labor market,anticipating some policy implications for reform on English schooling education to achieve optimal social welfare.The author analyzes return on English skills based on the perspective of screening theory among signaling theories about education,which is likely to be an innovative attempt of the studies on economics of language.Is wage premium of English skillsthe outcome of its human capital effect or its signaling effect,or a mix?To answer this question,the author needs to identify the two above-mentioned effects of English skills,based on previous empirical methods about screening theory and detailed matched data of both employees and employers.This serves as the core of the whole thesis.The research design is set on the basis of reviewing previous studies on screening theory abroad and domestic.In combination of classical empirical method and data from China Employer-Employee Survey,this thesis builds an econometric model based on Mincerian wage equation according to Wiles tests.The robust regression analysis aims at distinguishing the signaling effect and human capital effect of English skills through whether there issignificant wage premium for employees who learned English and use it at work,compared with those who do not.Besides,the author also discusses the heterogeneity of such effect among groups of rural and urban workers,female and male workers,managers and non-management staff,as well as the possible influencing mechanisms through which English skills exert human capital effect.The empirical results show that,learning plus using English at work will significantly promote employees' labor productivity.The marginal effect amounts to 17.7%,which is in consistent with current literature exploring return of English skills in China.Such significant premium shows that English skills incline to exert its human capital effect.For rural workers,females and non-management staff,however,English skill serves as a signal.Career development,job tasks and knowledge learning areproved to be influencing mechanisms of English human capital,besides the positive externality of foreign language study and its effect on non-cognitive abilities mentioned in the previous literature.Therefore,focusing on the main results,the thesis concludes with political suggestions on how to exert the human-capital effect as well as signaling effect of English skills and how to develop English education in rural schools.At last,the thesis reviews the limitation of the current study and proposes outlook for future works.