Inequalities in the financing of compulsory education in China: A comparative study of Gansu and Jiangsu Provinces with spatial analysis

In 1993 China made a decision to achieve universal 9-year compulsory education by 2000, but equity and adequacy of public financing of education have been questioned ever since. The core issue rests on resource allocation. During the same period, China implemented fiscal reform and introduced socialist market economy reform in the uncharted water, which then exacerbated regional disparities. At the same time, intra-province inequalities have been rising in the last two decades, which has been masked by national aggregated data. By using county-level data from 1994 to 2001, GIS mapping and spatial analysis, this study examines patterns of inequalities in school expenditure, and their association with government expenditure and economic growth in a poverty-stricken province, Gansu and in the wealthiest province, Jiangsu. The purpose is to examine how inequalities have evolved over time in different provinces and what factors have triggered rising inequalities in the transition. The findings show that the rising inequalities are due to: (1) the ever widening gap among spatially stratified counties, particularly between the top 25% and the lower 75% of the counties in both provinces; and, (2) little diffusion over 8 years in spatial structure of educational financing, government resource allocation or economic growth. Issues of localized financing but centralized administration as developmental strategy across China and their impact on perpetuating and rising inequalities are discussed.