The changing determinants of high school attainment in rural China

In recent years China has experienced a substantial increase in rural schooling levels and contemporaneous reforms in rural educational policies, including the nationwide adoption of free nine-year compulsory education, the two exempt and one compensation program, and the school consolidation policy. These developments point to the possibility that the determinants of rural education have changed. In this paper we examine empirically the determinants of rural high school attainment between 2002 and 2007. Using data from a nationwide household survey and a multilevel regression model with and without instrumental variables, we estimate the relationship between rural high school attainment and individual, family, and community level variables. We find that the size and significance of household income and other individual and household variables declined, while community characteristics and local public expenditures on schools continued to have a significant impact in both years. When we carry out the estimation using instrumental variables, the coefficients on parental education are no longer significant. We conclude that policy changes plus rapid income growth in rural China has brought about substantial change in the determinants of high school attainment, and that the widely observed correlation between parental and child education may be due to unobserved characteristics.