Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20745
Authors: 
Fleisher, Belton M.
Li, Haizheng
Li, Shi
Wang, Xiaojun
Year of Publication: 
2004
Series/Report no.: 
IZA Discussion paper series 1446
Abstract: 
We estimate selection and sorting effects on the evolution of the private return to schooling for college graduates during China?s between 1988 and 2002. We pay special attention to the changing role of sorting by ability versus budget-constraint effects as China?s education policy has changed from one in which the bulk of direct costs are paid by government for students who pass a rigid set of test to one in which freedom of choice is increasingly the rule for those who can afford to pay for tuition and living expenses while acquiring higher education. We find evidence of substantial sorting gains under the traditional system but that gains have diminished and even become negative as schooling choices widened and participation has become subject to increasing direct private costs. We take this as evidence consistent with the influence of financial constraints on decisions to attend college.
Subjects: 
return to schooling
sorting gains
heterogeneity
financial constraints
comparative advantage
JEL: 
O15
J24
J31
Document Type: 
Working Paper

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