Because higher education serves both public and private interests, the way it is conceived and financed is contested politically, appearing in different forms in different societies. What is public and private in education is a political–social construct, subject to various political forces, primarily interpreted through the prism of the state. Mediated through the state, this construct can change over time as the economic and social context of higher education changes. In this paper, we analyze through the state’s financing of higher education how it changes as a public/private good and the forces that impinge on states to influence such changes. To illustrate our arguments, we discuss trends in higher education financing in the BRIC countries—Brazil, Russia, India, and China. We show that in addition to increased privatization of higher education financing, BRIC states are increasingly differentiating the financing of elite and non-elite institutions.

Assessing student learning outcomes has become a global trend in higher education. In this paper, we report on the validation of the Chinese HEIghten® Critical Thinking assessment with a nationally representative sample of Electrical Engineering and Computer Science students from 35 institutions in China. Key findings suggest that there was a test delivery mode effect favoring the paper tests over the online tests. In general, the psychometric quality of the items was satisfactory for low-stakes, group-level uses but there were a few items with low discrimination that awaits further investigation. The relationships between test scores and various external variables such as college entrance examination scores, university elite status and student perceptions of the test were as expected. We conclude with speculations on the key findings and discussion of directions for future research.

This paper empirically estimates the return to education using twins data that the authors collected from urban China. Our ordinary least-squares estimate shows that one year of schooling increases an individual's earnings by 8.4%. If we use a within-twin fixed effects model, the return is reduced to 2.7%, but rises to 3.8% after the correction of measurement error. These results suggest that a large portion of the estimated returns to education is due to omitted ability or the family effect. We further investigate why the true return is low and the omitted ability bias high, and find evidence showing that it may be a consequence of China's education system, which is highly selective and exam oriented. More specifically, we find that high school education may mainly serve as a mechanism to select college students, but as a human capital investment per se it has low returns in terms of earnings. In contrast, both vocational school education and college education have a large return that is comparable to that found in the United States.

This paper examines the impact of entrepreneurship on economic growth by using a panel data set of 29 provinces in China over 20 years. Two indicators of entrepreneurship are defined and introduced into the traditional growth regression framework that is estimated using the system generalized method of moments. We also use the ratio of staff and workers of state-owned enterprises and per capita sown land area as the instrumental variables to identify the causal effect of entrepreneurship on economic growth. Our results suggest that entrepreneurship has a significant positive effect on economic growth and this finding is robust even after we control for other demographic and institutional variables. Our study provides some evidence that may be used as a basis for evaluating the effect of China’s policy on private business which has been increasingly relaxed since the late 1970s.

We estimate the wage premium associated with having a cadre parent in China using a recent survey of college graduates carried out by the authors. The wage premium of having a cadre parent is 15%, and this premium cannot be explained by other observables such as college entrance exam scores, quality of colleges and majors, a full set of college human capital attributes, and job characteristics. These results suggest that the remaining premium could be the true wage premium of having a cadre parent.

In recent decades, cheap labor has played a central role in the Chinese model, which has relied on expanded participation in world trade as a main driver of growth. At the beginning of China's economic reforms in 1978, the annual wage of a Chinese urban worker was only $1,004 in U.S. dollars. The Chinese wage was only 3 percent of the average U.S. wage at that time, and it was also significantly lower than the wages in neighboring Asian countries such as the Philippines and Thailand. The Chinese wage was also low relative to productivity. However, wages are now rising in China. In 2010, the annual wage of a Chinese urban worker reached $5,487 in U.S. dollars, which is similar to wages earned by workers in the Philippines and Thailand and significantly higher than those earned by workers in India and Indonesia. China's wages also increased faster than productivity since the late 1990s, suggesting that Chinese labor is becoming more expensive in this sense as well. The increase in China's wages is not confined to any sector, as wages have increased for both skilled and unskilled workers, for both coastal and inland areas, and for both exporting and nonexporting firms. We benchmark wage growth to productivity growth using both national- and industry-level data, showing that Chinese labor was kept cheap until the late 1990s but the relative cost of labor has increased since then. Finally, we discuss the main forces that are pushing wages up.

How much of the increase in sex ratio (male to female) at birth since the early 1980s in China is attributed to increased prenatal sex selection? This question is addressed by exploiting the differential introduction of diagnostic ultrasound in the country during the 1980s, which significantly reduced the cost of prenatal sex selection. We find that the improved local access to ultrasound technology has resulted in a substantial increase in sex ratio at birth. Our estimates indicate that roughly 40 to 50 percent of the increase in sex imbalance at birth can be explained by local access to ultrasound examinations.

Analyzing data from a unique survey of managers of Chinese private firms, we investigate how family ties with firm heads affect managerial compensation and job assignment. We find that family managers earn higher salaries and receive more bonuses, hold higher positions, and are given more decision rights and job responsibilities than nonfamily managers in the same firm. However, family managers face weaker incentives than professional managers, as seen in the lower sensitivity of their bonuses to firm performance. Our findings are consistent with the predictions of a principal-agent model that incorporates family trust and endogenous job assignment decisions.

To examine poverty on China’s campuses, we utilize the Chinese College Students Survey carried out in 2010. With poverty line defined as the college-specific expenditures a student needs to maintain the basic living standard on campus, we find that 22 percent of college students in China are living in poverty. Poverty is more severe among students from the rural or Western parts of the country. The college need-based aid program must be improved because its targeting count error is over 50 percent. Lacking other income sources, poor students rely heavily on loans and working to finance their college education.

This paper's findings suggest that an arbitrary Chinese policy that greatly increases total suspended particulates (TSPs) air pollution is causing the 500 million residents of Northern China to lose more than 2.5 billion life years of life expectancy. The quasi-experimental empirical approach is based on China’s Huai River policy, which provided free winter heating via the provision of coal for boilers in cities north of the Huai River but denied heat to the south. Using a regression discontinuity design based on distance from the Huai River, we find that ambient concentrations of TSPs are about 184 μg/m3 [95% confidence interval (CI): 61, 307] or 55% higher in the north. Further, the results indicate that life expectancies are about 5.5 y (95% CI: 0.8, 10.2) lower in the north owing to an increased incidence of cardiorespiratory mortality. More generally, the analysis suggests that long-term exposure to an additional 100 μg/m3 of TSPs is associated with a reduction in life expectancy at birth of about 3.0 y (95% CI: 0.4, 5.6).