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Conducting Policy-Based Education Finance Research in China

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Conducting Policy-Based Education Finance Research in China. The China Institute for Educational Finance Research (CIEFR). China’s first academic institution for educational finance research (Oct . 2005) An innovative joint-venture: MOF, MOE, and Peking University. - PowerPoint PPT Presentation

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Conducting Policy-Based Education Finance Research in ChinaThe China Institute for Educational Finance Research (CIEFR)Chinas first academic institution for educational finance research (Oct. 2005)

An innovative joint-venture: MOF, MOE, and Peking University.

Two major areas of activity:Policy consultingPolicy-related research

2Policy ConsultingChallenges:Small windows of timeTopics change quickly Little empirical evidence on which to base suggestionsPressure

Opportunities from engaging in policy consulting:Immediately access to policymakersUnderstand key concernsLearningDissemination of research findingsSupport for conducting research projects

Policy consulting: ProcessRefer to past empirical studies in ChinaUtilize existing data Our own past surveysOther large-scale survey/census datagovernment statistics (public)Review foreign country practices and policiesShort-term surveys, interviews, site visits

Policy Consulting: for the MOF/MOEExamples:Reform of Education Finance Statistics SystemReform of the Rural Compulsory Education Guarantee Funding MechanismKey Policies of Increasing Funding for Chinas Education During the Eleventh Five-Year Plan PeriodNational Plan for Medium and Long-Tem Education Reform and Development: Issues of Educational FinanceFinancial Support Mechanisms for R&D at Higher Education InstitutionsBudget Provision for National UniversitiesPolicy-related researchDescriptiveusing randomly sampled, representative data

(2) Policy or Program Impact EvaluationRandomized Control Trials (RCTs)Quasi-experimentsAssessment using reliable/valid measures/outcomes

(3) Action-based ResearchGood dataAdministrative (all students)Attention also on reliable/valid outcome/output indicators

6Some Current Areas of Research(1) Vocational Education(2) Academic High School Education (3) Higher Education

(4) Migrant Education(5) Early Childhood Education(6) Disabilities and Education

Small, diverse faculty team

7FirstBackground:

Changes in the supply/demand of Human Capital in ChinaThe size of economy in 2008 was more than16 times that in 1978It took the US nearly 100 years from 1870 to 1970 to grow by 10 times!

9Percent of Population in the Agricultural SectorIncome per CapitaUS and other OECD nationsEthiopia, Rwanda, etc.Iron Law of Economic DevelopmentData from the World BankThis is sometimes called the Kuznets curve10Percent of Popn in Ag. SectorIncome per Capita Development = IndustrializationModernization = UrbanizationZero: there are no high income countries in world with more than 10% of their populations that live in agriculture10-20%11Percent of Popn in Ag. SectorIncome per CapitaMiracle Developmentwith Korean CharacteristicsKorea1950sKorea1974KoreatodayKorea198712Percent of Popn in Ag. SectorIncome per CapitaIn 1980, China was: Poor Rural AgriculturalChina in 1980sChina at the start of Economic Reforms13

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16China is moving along the Transformation Path, according to the Iron Law From left to right INCOME From top to down URBANIZATION/INDUSTRIALIZATION17

Becoming better off income rising 18

Shenzhen in 1980

and 200019Overall Increase in Off-farm Work

In 2008 more than 90% of households have at least 1 family member (or son / daughter) working off the farmIn 1980: only 4% worked full time off the farm63%200820Transformation PathPercent of Popn in Ag. SectorIncome per CapitaSo it is clear that as China is growing (moving left to right across the graph), it also is beginning to move down the transformation path this is development

21The movement of this labor in vast quantities is what helps drive growth in the early stages of development

Hourly Wage, 1990sChina USAustralia Mexico Brazil Sri Lan.Japan EU Korea0.50A low unskilled wage in the 1980s/1990s is why such a large share of the things the world makes are manufactured in China today!23This was also enabled by Chinas education and health systems during the 1970 and 1980s seemed to have played an important roleInfectious diseases were controlled; infant mortality fell

School authorities got everyone into school (at least elementary school) to teach the rudiments of reading and arithmetic instill discipline to be a good worker!

2007Unskilled wageSince 2000Wage rises in coming yearsBut, the rise in wages is now happening in China Wage have risen rapidly recently In coming years projected to rise even faster 25Future growth of GDP (5, 6, 7 or 8 %/year) demand for labor will increase

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Birth ratesDeath ratesSupply of labor is falling In 1990 25 million babies/year / In 2010 15 million babies/year and fallingtoday27Summary: ImplicationsChina continues to grow: RISING DEMAND

Size of labor force falls: FALLING SUPPLY

Rising wages in the future

Changing industrial structure

By 2025 to 2030 $10-15/hour28Are rising wages bad?Of course notgood riddance to sweat shop jobs.

But, with higher wages, China will have to move itself up the productivity ladder

29So: Chinas real human capital challenge is coming

Can China become competitive in industrial sectors requiring medium and high skilled human capital?

Can it maintain relative equality/equity in the process?

30Achievements so far in Education1990s: universal 9-year compulsory education

Late 1990s: higher education expansionGER went from 5-6% in the mid-1990s to 29% in 2009Largest higher education system in the world

2000s: high school expansionGER went from 40% in late 1990s to 79% in 2009mandated 50:50 ratio between regular and vocational

What about Educational Quality?Shanghai PISA Results 2009 (PISA is for up to age 15 years old)

Quality in the rest of China?

Not much is known about quality in terms of student outcomes.CIEFRs Research: Three Areas(1) Vocational Education and Training

(2) Academic High School

(3) Higher Education (financial aid)Small, diverse faculty team

33(1) Investment in Vocational vs. General Schooling:Evaluating Chinas Expansion of Vocational Education and Training (VET)Research Questions about VETHow to balance investments in vocational vs. general education to support economic growth and reduce social inequality?

What are the returns to VET? if negligible, policymakers may consider slowing the expansion or improving the quality of VET. (2) What are the factors that keep junior high school graduates in poor, rural areas from continuing with their studies? A fairly low proportion of them go on to any type of high school.(3) What is the quality and cost-effectiveness of VET programs? Few mechanisms to evaluate the quality of VET programs(2) Supporting Disadvantaged Junior High StudentsRandomized trials involving junior high students in poor areas: Vouchers high school (academic or VET)Edu/career counselling (returns to school, career awareness)

Outcomes:Persistence/dropout in junior high schoolAcademic (exam) performanceHigh school matriculation rates

Baseline and Follow-up Surveys:2 provinces132 rural public junior hi schools, 473 classes19,832 seventh-grade students

132 junior high schools first year students (~20000)Control: 22 JHSs, 308 poor stusLong :22 JHSs41 classes: no training164 poor students no $$$Long+$$$: 22 JHSs86 of 172 poor students got $$$80 of 160 poor students got $$$140 poor studentsno $$$35 classes: long training43 classes: no training40 classes: long training$$$:22 JHSs79 classes158 of 316 poor students got $$$Short+$$$:22 JHSs36 classes: no training72 of 144 poor students got $$$39 classes: no training78 of 156 poor students got $$$Short: 22 JHSs36 classes: short training47 classes no training144 poor studentsno $$$188 poor studentsno $$$4 poor students X 473 classes = 1892 studentsVouchers ($$$) + LONG OR SHORT Counseling Interventions37Migrant JHS students in Beijing200+ million rural migrants in China, many adults bring their children to the urban areas

Household registration system restricts the educational options of these families/children

We conducted RCTs to examine the effect of vouchers and education savings plans on student persistence and academic performance.

Preliminary Results: Vouchers has some effect on reducing dropouts. Especially for students in poor, rural areas, less so for migrants in Beijing.

(3) Assessing VET High School QualityNov., 2011: baseline survey of students in computer application majors. Gave math and computer operation exams to students in ~110 VET high schools in 2 provinces. May, 2012: math and computer exams to the same students to assess the value-added of their programs.Collected other quality indicators from teachers, schools

Compare VET schoolsCompare VET and academic HSs

After May, 2012: RCTs training and incentives on how using data to improve student performance.May, 2013: Post-intervention math and computer exams

Academic High SchoolsGeneral ConcernsHuman capital formation

Academic high school is a sort of bottleneck in the pathway to college who gets there? implications for equality

Variation in academic high school quality may be great.Study in one NW province in ChinaSorting/Inequality in Education from High School to College

The Effects of Attending Different Academic High Schools

The Impact of Building Free, Elite High Schools For Students From Disadvantaged Areas

Policymakers provided admin data for up to ten years6 years: HS entrance exam data for select counties10 years: college admissions data for all countiesHS expenditures and revenues (select schools)

(1) Sorting/Inequality in the Province

(2) High School QualityHow to evaluate s

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